Entasis Therapeutics Completes Initial Closing of $35M Private Placement with Innoviva
WALTHAM, Mass., April 22, 2020 (GLOBE NEWSWIRE) -- Entasis Therapeutics Holdings Inc. (NASDAQ: ETTX) (“Entasis”), a clinical-stage biopharmaceutical company focused on the discovery and development
of novel antibacterial products, today announced that it has completed the initial $3.3 million closing of a $35 million common stock and warrant securities investment with Innoviva Inc. (NASDAQ:
INVA) ("Innoviva"), signed on April 12, 2020. Upon satisfaction of certain closing conditions, Innoviva will purchase the balance of the $35 million in Entasis common stock and warrant
securities in a second closing anticipated later in the second quarter of 2020 (excluding any consideration payable upon exercise of warrants).
Entasis plans to use the proceeds from the offering to support the continued development of its novel pipeline of pathogen-targeted antibacterial product candidates, which includes sulbactam-durlobactam (SUL-DUR) for carbapenem-resistant Acinetobacter baumannii infections, and zoliflodacin for uncomplicated gonorrhea, including infections caused by drug-resistant strains of Neisseria gonorrhoeae. Both of these product candidates are currently being evaluated in Phase 3 clinical trials.
"The threat from pathogens, including the global rise of multidrug-resistant bacteria, is real,” said Odysseas Kostas, M.D., Chairman of Innoviva's Board of Directors. “We look forward to working with the Entasis team to develop innovative antibacterial therapies.”
“We are excited to form this new relationship with Innoviva,” stated Manos Perros, President and Chief Executive Officer of Entasis. “The current pandemic has brought to the fore the importance of developing effective treatments against emerging pathogens. In these challenging times, it is critical that we continue to innovate against drug-resistant bacterial infections, and this investment will enable the advancement of our novel pathogen-targeted pipeline and position us to make our lead products available to patients in need.”
Pursuant to and subject to the terms and conditions of the securities purchase agreement and related agreements, Innoviva will purchase 14 million newly issued shares of Entasis common stock, at a price of $2.50 per share, and warrants to purchase up to 14 million additional shares of Entasis common stock, with an exercise price of $2.50 per share. The stock purchase will occur in two closings. At the initial closing, Innoviva purchased approximately 1.3 million shares of common stock and warrants to purchase approximately 1.3 million shares of common stock for an aggregate purchase price of $3.3 million. At the second closing, subject to an Entasis stockholder vote in favor of the transaction, Innoviva will purchase approximately 12.7 million shares of common stock and warrants to purchase approximately 12.7 million shares of common stock for an aggregate purchase price of $31.7 million. Upon completion of the first closing, Innoviva has the right to appoint one director to the Entasis Board of Directors and upon the second closing, Innoviva will have the right to appoint an additional director.