Mereo BioPharma Announces Completion of $70 Million Private Placement

Plans to Develop Etigilimab (Anti-TIGIT) Alongside Rare Disease Product Portfolio

LONDON and REDWOOD CITY, Calif., June 04, 2020 (GLOBE NEWSWIRE) -- Mereo BioPharma Group plc (NASDAQ: MREO, AIM: MPH) today announces the completion of a $70 million (£56 million) private placement (the “Fundraising”) with a number of new and existing U.S based institutional and accredited investors. OrbiMed led the Fundraising with participants including Vivo Capital, Surveyor Capital (a Citadel company), Pontifax Venture Capital, Samsara BioCapital, Commodore Capital, and funds managed by Janus Henderson Investors alongside existing investors Boxer Capital of Tavistock Group and Aspire Capital Fund, LLC.

Highlights

• Private placement completed raising $70.0 million (£56.0 million) before expenses.
• New Ordinary Shares and Convertible Loan Notes issued provide the Company with certainty of receiving the full amount of the proceeds of the private placement at closing.
  • 89,144,630 new Ordinary Shares have been placed at the Issue Price to raise $19.4 million (£15.5 million) before expenses, utilising share authorities granted on 2 June 2016 and 19 June 2019 and issued on a non-pre-emptive basis.
    
  • Convertible Loan Notes have been issued in an aggregate principal amount $50.6 million (£40.5 million) to complete the Fundraising.
    
• Price per Placing Share of 17.4 pence. 
  
• Investors  have received conditional Warrants to subscribe for further Ordinary Shares in an aggregate number equal to 50 per cent of both the new Ordinary Shares purchased by that investor in the Placing and the Ordinary Shares issuable upon conversion of the Convertible Loan Notes purchased by that investor in the Fundraising, with an exercise price of 34.8 pence ($0.44) each. The Warrants will be capable of being exercised for a period of 3 years after the date on which the Resolutions are passed.
• SVB Leerink acted as the exclusive placement agent to the Company in connection with the Fundraising.

Mereo is also announcing today plans to advance etigilimab (Anti-TIGIT) into a Phase 1b study in Q4 2020 alongside progressing its rare disease product portfolio. This is based on the Company’s existing promising clinical data with etigilimab as well as the increasing interest in TIGIT as an immuno-oncology target. The Company intends to complete a strategic partnership for setrusumab for the treatment of osteogenesis imperfecta (“OI”) prior to initiation of the pivotal Phase 3 study and to complete the ongoing Phase 2 study of alvelestat for the treatment of alpha-1 antitrypsin deficiency (“AATD”), with topline data currently expected in 2H 2021.