Sorrento Therapeutics To Buy ACEA Therapeutics For $38M In Stock

Sorrento Therapeutics Inc SRNE has agreed to acquire ACEA Therapeutics Inc in an all-stock deal of $38 million in shares of Sorrento common stock.
Sorrento will also pay the ACEA up to $450 million in additional milestone payments and 5-10% royalty of the annual net sales.
The acquisition will include late clinical-stage drug Abivertinib, AC0058, AC0939, and ACEA's extensive proprietary library of small molecules (over 1,000,000 compounds).
Lead candidate abivertinib is a small molecule tyrosine kinase inhibitor that selectively targets both a mutant form of the epidermal growth factor receptor and Bruton's tyrosine kinase. It is currently being studied as a Phase 2 treatment for COVID-19-induced respiratory compromise in the U.S. and Brazil.
AC0058 a BTK inhibitor, is currently in a Phase 1b trial for Lupus patients in the U.S.
The acquisition will also include ACEA's facility located in Quzhou, China, on a 23-acre campus with five buildings.
The facility currently can manufacture up to 5,000 kg/year of APIs and 50 million capsules of the final drug product.
The merger is expected to close in the second quarter of 2021.
Price Action: SRNE shares gained 1.5% at $8.13 in market trading on the last check Monday.