Oncternal and GTx to Merge, Form New Company Based in San Diego
Shares of GTx, Inc. have shot up more than 87 percent in premarket trading after the company announced it has struck a reverse merger deal with privately-held Oncternal Therapeutics, Inc. to create a new company.
Under terms of the deal, shareholders of San Diego-based Oncternal will become the majority owners of GTx common stock. With the merger, the new entity will create a publicly-traded, clinical-stage oncology company. The new company will be named Oncternal Therapeutics, Inc. and plans to change its ticker symbol on the Nasdaq Capital Market to ONCT upon closing of the transaction.
The new Oncternal Therapeutics will be helmed by James Breitmeyer, the co-founder, president and chief executive officer of Oncternal. David Hale, a co-founder of Oncternal, will continue as chairman of the board of the combined company. Oncternal Therapeutics will be based in San Diego. When the merger is complete, no GTx employee is expected to remain an employee of the combined company.
The new company’s pipeline will include Oncternal’s lead program, cirmtuzumab, an investigational, potential first-in-class anti-ROR1 monoclonal antibody. Cirmtuzumab is currently in a Phase I/II clinical trial in combination with AbbVie’s Imbruvica (ibrutinib), a Bruton's tyrosine kinase inhibitor, being developed for the treatment of chronic lymphocytic leukemia (CLL) and mantle cell lymphoma (MCL). Additionally, cirmtuzumab is in a Phase I trial in combination with paclitaxel for women with metastatic breast cancer.
Another piece of the new company’s pipeline is TK216, an investigational, potential first-in-class small molecule designed to inhibit the biological activity of ETS-family transcription factor oncoproteins. TJ216 is being evaluated alone and in combination with vincristine in a Phase I clinical trial in patients with relapsed or refractory Ewing sarcoma. The pipeline will also include a ROR-1 targeted chimeric antigen receptor T-cell program and a Selective Androgen Receptor Degrader program. The SARD program is a preclinical program designed to treat castration-resistant prostate cancer in men who are non-responsive to current androgen targeted therapies.
“This merger introduces Oncternal and its promising oncology pipeline to the public market and provides additional capital resources to advance our programs to potential value inflection points,” Breitmeyer said in a statement. “In addition to clinical data expected from our cirmtuzumab and TK216 programs later this year and during the first half of 2020, we also plan to have preclinical results that get us ready for clinical testing of our ROR1 CAR-T program. The addition of GTx’s SARD technology strengthens our pipeline and augments our entire oncology franchise, which includes a range of therapeutic approaches for a variety of difficult to treat cancers.”
For GTx, the reverse merger comes after Robert J. Wills, executive chairman of the board, announced in October that the company was exploring strategic options with a goal of “optimizing the full potential of our development pipeline.” Willis will serve on the board of directors of the new company.
The reverse merger is expected to close in the second quarter. When the stock-for-stock transaction closes, the former stockholders of Oncternal will hold approximately 75 percent of the outstanding shares of common stock.