Rafael Holdings Announces Strategic Merger with Rafael Pharmaceuticals to Form a Focused Late-Stage Clinical Oncology Company
Rafael Holdings, Inc. (NYSE: RFL) has announced a merger with Rafael Pharmaceuticals, a late-stage oncology firm specializing in cancer metabolism therapeutics. The merger, unanimously approved by both boards, aims to create a publicly traded company focused on innovative cancer treatments. Key figures include Howard Jonas as Chairman and Ameet Mallik as CEO. The merger includes the acquisition of Altira Capital for $30 million and requires a capital raise of at least $50 million. The lead drug, CPI-613 (devimistat), is in Phase 3 trials for metastatic pancreatic cancer, with results expected in Q4 2021.
- Merger creates a focused late-stage clinical oncology company with enhanced market position.
- CPI-613 (devimistat) shows significant promise with a 61% response rate in early-stage trials.
- Expected synergies from combined assets will strengthen developmental capabilities.
- Merger requires a minimum capital raise of $50 million, which may strain financial resources.
- Stockholder approvals are subject to uncertainty, impacting the closing timeline.
NEWARK, N.J. and CRANBURY, N.J., June 21, 2021 /PRNewswire/ -- Rafael Holdings, Inc., (NYSE: RFL) announced that it has entered into a merger agreement with Rafael Pharmaceuticals, Inc., a privately held, late-stage clinical oncology company focused on cancer metabolism-based therapeutics. The Boards of Directors of the two companies, as well as a special independent committee of the Rafael Holdings Board of Directors, have unanimously approved a merger agreement that provides for the combination of the two companies.
Howard Jonas will serve as the Chairman, Ameet Mallik will serve as the Chief Executive Officer and Sanjeev Luther, the President and Chief Executive Officer of Rafael Pharmaceuticals, will join the Board of Directors of the combined company. The merged company will retain the Rafael Pharmaceuticals name and Rafael Holdings' listing on the New York Stock Exchange. Rafael Holdings and its subsidiaries currently own a majority of the outstanding stock of Rafael Pharmaceuticals and a significant stake on a fully-diluted basis.
"The strategic merger of Rafael Pharmaceuticals and Rafael Holdings will create a publicly traded, late-stage clinical oncology company positioned to synergistically leverage the assets of both companies. The merged company will focus on developing therapeutics that selectively target cancer metabolic pathways while simultaneously harnessing the immune system," said Howard Jonas, Chairman of the Board. "The Company's lead drug, CPI-613® (devimistat), is in Phase 3 clinical trials for metastatic pancreatic cancer and relapsed or refractory AML. In an early-stage clinical trial, devimistat in combination with modified FOLFIRINOX exhibited a
"I am truly excited to lead the Company at this pivotal time as we advance devimistat, a pipeline in a molecule, through two Phase 3 registrational clinical trials and several Phase 1 and Phase 2 clinical trial programs in additional indications," said Ameet Mallik. "I look forward to working with my new colleagues and world-leading scientific advisors to continue to advance devimistat, as well as our novel early-stage pipeline, through multiple important milestones over the next eighteen months as we evolve towards a fully integrated oncology company."
"I look forward to joining the Board of Directors of the combined company as we embark on this momentous milestone," said Sanjeev Luther. "I am proud of the work our team has done to advance devimistat and our pipeline with the goal of bringing effective cancer treatments to patients. This merger will allow us to continue to push the boundaries of cancer therapies."
The data readout for the Phase 3 clinical trials of devimistat in metastatic pancreatic cancer is expected in the fourth quarter of calendar 2021. Devimistat has received Fast- Track designation from the U.S. Food and Drug Administration for metastatic pancreatic cancer and AML as well as orphan drug status for the treatment of pancreatic cancer, AML, myelodysplastic syndrome (MDS), Burkitt lymphoma, peripheral T-cell lymphomas and soft tissue sarcoma.
Holders of Rafael Pharmaceuticals capital stock will receive shares of Rafael Holdings Class B common stock based on the formula set forth in the merger agreement amounting to approximately
On closing, Rafael Holdings will acquire for
The merger agreement takes into account the value of Rafael Holdings' assets including its interests in Rafael Pharmaceuticals through shares and warrants, as well as Rafael Holdings' other pharmaceutical industry holdings, financial interests and real estate assets. The merger agreement contemplates the exchange or termination of warrants and other contingent rights to acquire Rafael Pharmaceuticals capital stock with a goal of a single combined company with a simplified capital structure and no remaining minority interests in the current Rafael Pharmaceuticals. The merger is subject to customary regulatory and other conditions, including a stockholder vote at both companies by a majority of stockholders that are not affiliates of Rafael Holdings and the financing condition described above. Key stockholders of both companies have agreed to support the transaction.
Houlihan Lokey is the sole financial advisor and Olshan Frome Wolosky LLP is the legal advisor to the independent special committee of the Board of Directors of Rafael Holdings in the transaction. Schwell Wimpfheimer & Associates is the legal advisor of Rafael Holdings in the transaction.
Raymond James & Associates is the sole financial advisor and Orrick is the legal advisor to Rafael Pharmaceuticals in the transaction.
About Rafael Holdings, Inc.:
Rafael Holdings (NYSE: RFL) is focused on the development of novel cancer therapies. The Company is a significant investor in two clinical stage oncology companies-- Rafael Pharmaceuticals, Inc. and LipoMedix Pharmaceuticals Ltd. Through its wholly owned Barer Institute subsidiary, the Company is developing a pipeline of compounds focused on the regulation of cancer metabolism. For more information, visit www.rafaelholdings.com.
About Rafael Pharmaceuticals, Inc.
Rafael Pharmaceuticals is a clinical-stage oncology company focused on selectively targeting cancer metabolic pathways while simultaneously harnessing the immune system to attack hard-to-treat cancers. The Company's lead drug, CPI-613 (devimistat), is being evaluated in multiple clinical studies including two Phase 3 registrational clinical trials for metastatic pancreatic cancer and r/r acute myeloid leukemia. Multiple Phase 1/2 clinical trials are ongoing or planned in Biliary, r/r Burkitt, r/r Clear Cell Sarcoma, r/r T-cell lymphoma, r/r MDS, and Colorectal cancer.
Devimistat has Orphan Drug Designations for six indications in the US and two indications in the EU. The Company's investors include Rafael Holdings, Inc. (NYSE: RFL). For more information, please visit https://rafaelpharma.com/.
Safe Harbor Statement
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SOURCE Rafael Holdings, Inc.
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