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ESSA Pharma, Realm Therapeutics To Merge In $20M Deal

ESSA Pharma, Realm Therapeutics To Merge In $20M Deal

Canadian company ESSA Pharma Inc. (NASDAQ: EPIX) is set to acquire U.S. biopharmaceutical company Realm Therapeutics plc (NASDAQ: RLM).

What To Know

The acquisition is expected to be completed by mid 2019. Once the acquisition is complete the company will continue to operate as ESSA Pharma, and trade on the Nasdaq and TSX-V Market and operating in the United States as ESSA Pharmaceuticals Corp.

The terms of the acquisition value Realm's issued and outstanding shares at approximately $21.5 million, which represents a 5 percent premium over Realm's estimated net cash amount of $20.5 million at the closing of the acquisition. ESSA will acquire all of the issued and outstanding shares of Realm in an all-stock transaction.

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Why It's Important

ESSA Pharma engages in the development of small molecule drugs for prostate cancer. Realm is an emerging specialty biopharmaceutical company focused on developing novel immunomodulatory therapies.

"We believe that the current transaction, which is intended to be supplemented by an equity financing involving insiders and other investors, will deliver sufficient financial resources to ESSA to achieve multiple value-inflection points and key near-term objectives in the coming two years including: first, completion of a Phase 1 clinical trial for our lead program EPI-7386 in patients with advanced prostate cancer progressing on the latest generation of anti-androgens," ESSA CEO David Parkinson said in a press release.

What's Next

The groups have announced that upon completion, ESSA’s management team will continue to lead the company. It's expected the company's board of directors will be increased to nine members of which three will be Realm-nominated candidates, with two current ESSA directors resigning.

The company will focus on advancing ESSA's pipeline of novel potential treatments for prostate and other cancers.


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