Brooklyn ImmunoTherapeutics Executes Letter of Intent to Acquire Novellus Therapeutics
NEW YORK, June 14, 2021 (GLOBE NEWSWIRE) -- Brooklyn ImmunoTherapeutics LLC (NYSE American: BTX) ("Brooklyn"), a biopharmaceutical company focused on exploring the role that cytokine and gene editing/cell therapy can have in treating patients with cancer, blood disorders, and monogenic diseases, today announced it has executed a non-binding letter of intent (“LOI”) to acquire Novellus Therapeutics (“Novellus”), a company developing next-generation engineered mesenchymal stem cell (“MSC”) therapies using patented mRNA cell reprogramming and gene editing technologies licensed from Factor Bioscience (“Factor”). It is expected that the transaction will involve an acquisition by Brooklyn of all of the outstanding equity of Novellus (the “Transaction”).
Pursuant to the terms of the LOI, the parties intend to sign a definitive agreement (the “Definitive Agreement”) and work to close the acquisition on or before July 15, 2021. The terms of the LOI value Novellus at $125.0 million, which is proposed to be paid by Brooklyn by a combination of $17.4 million in cash and $107.6 million in BTX common stock. Brooklyn currently has over $43 million of cash on its balance sheet to fund the cash component of the Transaction. The completion of the Transaction is subject to a number of conditions, and no assurances can be made that the parties will successfully negotiate and enter into a Definitive Agreement or that the proposed Transaction will be closed on the terms or timeframe contemplated by the LOI, or at all.
“If acquisition of Novellus is transacted, Brooklyn would achieve both strategic and economic benefits. This acquisition would further advance Brooklyn’s evolution into a platform company with a pipeline of next-generation gene and cell therapy programs. We believe Novellus’ next-generation engineered MSC platform can position Brooklyn to become a leader in stem cell therapies, with the ability to develop multiple therapeutic candidates rapidly,” said Brooklyn’s Chief Executive Officer and President Howard J Federoff, M.D., Ph.D.
Dr. Federoff continued, “The acquisition would accelerate our research and development efforts and bring Brooklyn closer to clinical development with an MSC product. The increased alignment between Factor and Brooklyn resulting from this acquisition could allow faster development of clinical products for orphan diseases such as sickle cell anemia, familial amyloidosis and cell therapies for cancer. With the acquisition contemplated by this LOI, Brooklyn continues to seek to execute on its strategic plan to become a leader in gene editing, stem cell therapy and mRNA therapeutics.”
The acquisition of Novellus builds on the license agreement that Brooklyn executed earlier this year with Factor and Novellus, and leaves in place the Factor component of that agreement, which grants Brooklyn exclusive rights to develop certain next-generation mRNA gene editing and cell therapy products. The Transaction would relieve Brooklyn from the obligation to pay Novellus a set of upfront fees, clinical development milestone fees and post-registration royalties under the license agreement.
“We are delighted about the opportunity to work more closely with Brooklyn on next generation gene editing and cell therapy products. We believe this transaction would advance Novellus’ vision to transform cell therapy through the application of state-of-the-art mRNA technologies,” said Matthew Angel, Ph.D., co-founder and CSO of Novellus and Co-Founder and CEO of Factor.
About the Transaction
The completion of the Transaction is subject to a number of conditions, including but not limited to the following: completion of mutually satisfactory due diligence, execution of the Definitive Agreement, and receipt of all required corporate and third-party approvals, including fulfillment of all applicable regulatory requirements and conditions necessary to complete the Transaction.
No assurances can be made that the parties will successfully negotiate and enter into a Definitive Agreement, or that the proposed Transaction will be closed on the terms and/or timeframe currently contemplated, or at all. As noted above, the Transaction remains subject to regulatory and board approvals, along with other customary conditions.
About Brooklyn ImmunoTherapeutics
Brooklyn is focused on exploring the role that cytokine-based therapy can have in treating patients with cancer, both as a single agent and in combination with other anti-cancer therapies. The company is also exploring opportunities to advance oncology, blood disorder, and monogenic disease therapies using leading edge gene editing/cell therapy technology through the newly acquired license from Factor Bioscience and Novellus Therapeutics.
Brooklyn’s most advanced program is studying the safety and efficacy of IRX-2 in patients with head and neck cancer in Phase 2B. In a Phase 2A clinical trial in head and neck cancer, IRX-2 demonstrated an overall survival benefit. Additional studies are either underway or planned in other solid tumor cancer indications. For more information about Brooklyn and its clinical programs, please visit www.BrooklynITx.com.
About Novellus Therapeutics
Novellus is a pre-clinical stage biotechnology company developing engineered cellular medicines using its licensed patented non-immunogenic mRNA, high-specificity gene editing, mutation-free & footprint-free cell reprogramming and serum-insensitive mRNA lipid delivery technologies. Novellus is privately held and is headquartered in Cambridge, MA. For more information, please visit www.novellustx.com.
The first six paragraphs of this press release contain forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, which are intended to be covered by the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Forward-looking statements are any statements that are not statements of historical fact and may be identified by terminology such as “expect,” “intend,” “plan,” “believe,” “anticipate,” “may,” “will,” “would,” “should,” “could,” “contemplate,” “estimate,” “predict,” “potential” or “continue,” or the negative of these terms or other similar words. Forward-looking statements are based on current beliefs and assumptions that are subject to risks and uncertainties and are not guarantees of future performance. Actual results could differ materially from those stated or implied in any forward-looking statement as a result of various factors, including, but not limited to, uncertainties related to whether the Transaction will be completed by the parties on the terms contemplated by the LOI or at all, as set forth above under “Description of the Transaction.” You should not rely upon forward-looking statements as predictions of future events. The terms of the LOI are not binding on either party, and either party may elect to terminate discussion of the Transaction in the party’s discretion. Brooklyn cannot assure you that the Transaction will be completed or that, if it is completed, that the final terms of the Transaction will not be materially different than those contemplated by the LOI. The forward-looking statements made in this communication speak only as of the date on which they were made, and Brooklyn does not undertake any obligation to update the forward-looking statements contained herein to reflect events that occur or circumstances that exist after the date hereof, except as may be required by applicable law or regulation.
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