Intrinsic Medicine has signed a definitive business combination agreement with special purpose acquisition (SPAC) firm Phoenix Biotech Acquisition to create a public company.
The merged business will use human milk biology for the treatment of Gut-Brain Axis (GBA) disorders.
The merger reflects a $136m pre-money equity price and is anticipated to offer up to $178.8m in cash held in trust to Intrinsic.
Additionally, the parties plan to pursue further financing through a private placement or otherwise which would bring additional cash proceeds to the merged firm apart from the cash held in Phoenix’s trust account.
To be named Intrinsic Medicine following closing, the combined company will be led by current Intrinsic CEO Alexander Martinez and president and COO Jason Ferrone.
Intrinsic’s pipeline comprises synthetic biology-produced human milk oligosaccharide (HMO) drug candidates, including OM001 (3’sialyllactose, or 3’SL), OM002 and OM003 (6’-sialyllactose, or 6’SL).
These drugs could potentially treat GBA and some inflammatory ailments, including irritable bowel syndrome, inflammatory bowel diseases, rheumatoid arthritis, atopic dermatitis, oligoarticular juvenile idiopathic arthritis and autism spectrum disorder.
The merged business’ cash resources are estimated to offer Intrinsic the capital to progress its lead compound, OM002, and other pipeline assets.
These resources will also be used to fund a Phase IIb clinical trial of OM002 in more than 400 subjects with constipation dominant form of irritable bowel syndrome (IBS-C).
The boards of directors of both companies have granted unanimous approval for the merger.
Subject to necessary approvals and closing conditions, the deal is anticipated to conclude in the first half of next year.
Ferrone said: “Our planned placebo-controlled Phase IIb clinical study of OM002 in IBS-C will be the first of its kind to evaluate the safety and efficacy of an HMO-based medicine in patients living with a GBA disorder.
“We anticipate disclosing top-line data from the study in the first half of 2024, which we expect will build on existing clinical, preclinical and toxicology data supporting the bioactivity, safety and tolerability of HMOs and validate the therapeutic use of these compounds.”