In a release issued under the same headline earlier today
by Innovate Biopharmaceuticals, Inc. (Nasdaq:INNT) please note
that the stock symbol for Monster Digital, Inc. has been added
to the end of the first bullet point. The corrected release
follows:
Innovate Biopharmaceuticals Announces Successful Merger
Completion
- Completion of Merger with Monster Digital,
Inc. (Nasdaq:MSDI)
- Shares of combined company will begin trading on Nasdaq with
new ticker INNT and will reflect a 1 for 10 reverse split on
Wednesday, January 31, 2018
- Concurrent financing of more than $21 million
- Phase 3 clinical trials for larazotide acetate (INN-202) for
celiac disease expected to commence Q2-2018
Innovate Biopharmaceuticals, Inc. (Nasdaq:INNT) a clinical stage
biotechnology company focused on developing novel autoimmune and
inflammation therapeutics, announced the completion of its merger
(the “Merger”) with Monster Digital, Inc. today. In connection with
the completed Merger, Monster Digital, Inc. was renamed Innovate
Biopharmaceuticals, Inc. Innovate’s rich, late-stage clinical
pipeline focuses on addressing unmet needs in diseases such as
celiac disease, inflammatory bowel disease (IBD) and nonalcoholic
steatohepatitis (NASH). Innovate Biopharmaceuticals shares
will continue to trade under Monster Digital’s ticker MSDI on
Tuesday, January 30, 2018, and, during such time, Nasdaq share
numbers will not reflect the 1 for 10 reverse split that occurred
on January 30, 2018. Innovate Biopharmaceuticals shares will
commence trading on Nasdaq with the new ticker INNT and will
reflect the 1 for 10 reverse split in trading on Wednesday, January
31, 2018.
Commenting on the Merger, Innovate’s CEO, Christopher Prior,
Ph.D., stated: “We intend to use the proceeds from the concurrent
financing to advance our celiac disease drug candidate into Phase 3
clinical trials with the goal of bringing a much-needed therapy to
market for a disease that affects approximately 1% of the
population. In addition, we believe that as a public entity we will
be able to engage a wider range of investors, which will allow us
to advance our mild-to-moderate ulcerative colitis combination
therapy into Phase 2 trials and to expand our pipeline.”
Jay Madan, founder and president, of Innovate remarked, “It’s an
exciting transition for Innovate as we strive to become a leader in
autoimmune and inflammatory drug development for diseases with
unmet medical needs. With the continued support from our existing
investors, and now with access to the capital markets, our main
focus will be rapidly progressing our clinical assets.”
H.C. Wainwright & Co. acted as lead placement agent and GP
Nurmenkari, Inc. acted as co-lead placement agent in connection
with the concurrent financing. Intuitive Venture Partners acted as
exclusive financial advisor for the concurrent financing
transaction. Piper Jaffray acted as Innovate’s exclusive financial
advisor for the merger, and Wilson Sonsini Goodrich & Rosati,
P.C. acted as Innovate’s legal counsel. The Benchmark Company LLC
acted as Monster Digital’s financial advisor for the transaction
and Manatt, Phelps & Phillips, LLP acted as Monster Digital’s
legal counsel.
About the Transaction:
Under the terms of the definitive merger agreement, Innovate
shareholders, including investors in a financing that closed
concurrently with the Merger, will receive newly issued shares of
Monster in exchange for Innovate stock. In connection with and
prior to the closing of the Merger, Monster Digital effected a
1-for-10 reverse stock split of its common stock.
As previously disclosed, immediately prior to
the effective date of the Merger, Monster completed a spin-off
transaction (the “Spin-Off”). As a result of the Spin-Off, all of
the business, assets and certain of the liabilities of Monster that
were not assumed by Innovate in connection with the Merger were
transferred into a private wholly-owned subsidiary of Monster, MD
Holding Co., Inc. Further to the Spin-Off, holders of record of
Monster’s common stock as of the close of business on January 29,
2018, will receive a pro rata distribution of one share of MD
Holding Co., Inc. common stock for each share of Monster common
stock held as immediately prior to the Spin-Off.
About Innovate Biopharmaceuticals, Inc.:
Innovate is a clinical stage biotechnology company focused on
developing novel autoimmune and inflammation therapeutic drugs.
Innovate’s lead drug candidate, larazotide acetate (INN-202),
has successfully met its primary endpoint in a phase 2b efficacy
clinical trial for celiac disease. Larazotide successfully
completed the End of Phase 2 Meeting with the FDA last year to
prepare for expected Phase 3 clinical trials for larazotide in
celiac disease in Q2 2018. In clinical studies in more than 800
patients, larazotide demonstrated a favorable safety profile
comparable to placebo, due to what Innovate believes is its lack of
systemic absorption from the small bowel. Larazotide has also
received Fast Track designation from the FDA.
Larazotide, an oral peptide formulated into a capsule, has a
unique mechanism of action which decreases intestinal permeability
and regulates tight junctions by reducing antigen trafficking
across intestinal epithelial cells. Innovate believes that
larazotide is the only drug in the clinic with this mechanism of
action of reducing intestinal permeability. Increased intestinal
permeability, sometimes referred to as “leaky gut,” has been widely
recognized in the literature as a gateway to multiple autoimmune
diseases, including celiac disease, irritable bowel syndrome (IBS),
inflammatory bowel diseases (IBD, Crohn’s and ulcerative colitis),
type 1 diabetes mellitus (T1DM), nonalcoholic steatohepatitis
(NASH), chronic kidney disease (CKD) and others.
Innovate's second drug candidate, INN-108, is entering Phase 2
clinical trials for the treatment of mild to moderate ulcerative
colitis. INN-108 is a novel small molecule comprised of two active
parts with anti- inflammatory and immunodulatory properties coupled
through an azo bond. To date Innovate has no reason to believe that
INN-108 has any detectable systemic absorption when orally
administered until it reaches the colon where the active components
are released locally to reduce inflammation.
For more information, please
visit http://www.innovatebiopharma.com/
Forward Looking Statements
Some of the statements in this release are forward-looking
statements within the meaning of Section 27A of the Securities Act
of 1933, Section 21E of the Securities Exchange Act of 1934, and
the Private Securities Litigation Reform Act of 1995, which involve
risks and uncertainties. These statements relate to future events,
future expectations, plans and prospects. Although Innovate
believes that the expectations reflected in such forward-looking
statements are reasonable as of the date made, expectations may
prove to have been materially different from the results expressed
or implied by such forward-looking statements. Innovate has
attempted to identify forward-looking statements by terminology
including "possible," "may," "believe" or other words that convey
uncertainty of future events or outcomes to identify these
forward-looking statements. Forward-looking statements include,
among others, statements regarding the proposed reverse-merger
transaction with Innovate and the mechanism of action and
therapeutic effects of larazotide acetate. These statements are
only predictions and involve known and unknown risks,
uncertainties, and other factors, including those discussed under
the heading "Risk Factors" in our Annual Report on Form 10-K filed
with the Securities and Exchange Commission on March 31, 2017, in
our Quarterly Report on Form 10-K filed with the Securities and
Exchange Commission on May 19, 2017, in our Definitive Proxy
Statement filed with the Securities and Exchange Commission on
October 12, 2017, and in other documents filed by us from time to
time with the Securities and Exchange Commission. Any
forward-looking statements contained in this release speak only as
of its date. We undertake no obligation to update any
forward-looking statements contained in this release to reflect
events or circumstances occurring after its date or to reflect the
occurrence of unanticipated events.
Innovate Biopharmaceuticals, Inc.Kendyle
WoodardTel: 919-275-1933Email:
investor.relations@innovatebiopharma.com
www.innovatebiopharma.com
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