BOSTON, Aug. 24, 2020 /PRNewswire/ -- Yumanity
Therapeutics and Proteostasis Therapeutics, Inc. (Nasdaq: PTI)
today announced that the companies have entered into a definitive
merger agreement. The combined company, operating under the
name Yumanity Therapeutics, Inc., will leverage a common scientific
expertise in the area of protein misfolding to advance Yumanity's
pipeline of innovative, disease-modifying programs for
neurodegenerative diseases.
Yumanity's first clinical-stage product candidate, YTX-7739, is
currently in Phase 1 clinical development for the treatment and
disease modification of Parkinson's disease. Yumanity is also
advancing several additional candidates for other neurodegenerative
disorders, including dementia with Lewy bodies, multi-system
atrophy, amyotrophic lateral sclerosis (ALS or Lou Gehrig's disease), and frontotemporal lobar
dementia (FTLD).
"The combination of PTI and Yumanity brings together two
technologies rooted in a shared scientific legacy of protein
misfolding as the basis of disease, as well as capabilities and
resources that offer shareholders a broad platform for value
creation," commented Meenu Chhabra,
President and Chief Executive Officer of PTI. "We believe the
combined company is well-positioned to advance multiple programs
into and through the clinic, including Yumanity's lead candidate
YTX-7739, currently in Phase 1 trials for the treatment of
Parkinson's disease. We are excited to be working with Yumanity's
management team and leading investors to complete the merger."
Yumanity has raised more than $100
million from leading investors that include Alexandria
Venture Investments, Biogen, Fidelity, Merck, Pfizer, Redmile
Group, and Sanofi Ventures. The Company also recently entered into
a strategic research collaboration with Merck (known as MSD outside
the United States and Canada) for the discovery and development of
novel agents for the treatment of ALS and FTLD with Yumanity
eligible to receive future payments totaling approximately
$500 million in addition to royalties
on the net sales of any marketed products. Upon the anticipated
closing of the merger between PTI and Yumanity, Richard Peters, M.D., Ph.D., President, Chief
Executive Officer and Director of Yumanity, will become President,
Chief Executive Officer and Director of the combined company.
"Yumanity's state-of-the-art R&D efforts and deep insights
into new potential targets to treat neurodegenerative diseases
places us on a rapid trajectory toward our goal of revolutionizing
the treatment of these disorders. Our merger with PTI should
enable the combined company to grow faster, deliver potential
therapies to patients more quickly and create sustainable
shareholder value well beyond what either of us would achieve
separately," said Dr. Peters. "We have made significant clinical
and business progress over the past several months, including our
recent strategic research collaboration with Merck and our Series C
financing. This merger also ensures that we have access to
the additional capital we will need to advance our pipeline of
disease-modifying therapies."
"Today's announcement brings together two organizations that
share a common scientific heritage in the science of protein
misfolding and brings that science one step closer to novel
solutions for patients suffering from the debilitation of
neurodegenerative diseases," said Tony
Coles, M.D., Chairman and Co-founder of Yumanity
Therapeutics. "We look forward to continuing this important
clinical work on behalf of patients as we make this transition to
becoming a public company."
Proteostasis' Cystic Fibrosis (CF) Program Update
PTI also announced today that it is pursuing a strategic
transaction related to its proprietary CFTR modulators. PTI plans
to share proceeds from any monetization of its CF assets through
contingent value rights (CVR). PTI stockholders of record as of the
close of the merger would receive a portion of any upfront payment
and CVRs entitling the holders to all net proceeds from any future
milestones derived from the grant, sale or transfer of rights by
PTI through a transaction completed from now until the closing of
the merger. PTI stockholders of record would also be entitled to a
portion of any net proceeds from a transaction completed within
nine months of the closing of merger. In addition to the
merger agreement, a form of the CVR agreement outlining the
mechanism for distributing of any such proceeds to legacy PTI
holders will be filed with the U.S. Securities and Exchange
Commission on Form 8-K.
PTI's CFTR modulators are currently being studied as part of the
CHOICES development program. 502 subjects have completed enrollment
in the organoid portion of the study, with data expected in the
fourth quarter of 2020.
"We believe that our CF drug candidates have the highest
probability of reaching patients in the hands of a pharmaceutical
company with global development and commercialization capabilities
that shares our vision of empowering the global CF patient
community with more treatment options is realized," said Ms.
Chhabra. "It has been an honor to serve the CF community in the
fight to bring new treatment options to patients and their
families."
About the Proposed Merger
Under the terms of the merger agreement, PTI will acquire all
outstanding shares of Yumanity in exchange for newly-issued shares
of PTI common stock. Upon completion of the proposed acquisition,
it is anticipated that existing PTI shareholders will own
approximately 32.5% of the combined company and Yumanity
shareholders will own approximately 67.5% of the combined company.
The actual allocation will be subject to adjustment based on each
company's outstanding equity ownership and Proteostasis' net cash
balance at the time of closing of the merger. Following
completion of the merger, the Yumanity Board of Directors will be
expanded to nine persons to include the appointment of two current
Proteostasis directors. The existing Yumanity Directors will
continue to serve in their current positions and Dr. Coles will
remain as chairperson.
The transaction has been approved by the boards of directors of
both companies. The merger is expected to close in the fourth
quarter of 2020, subject to customary closing conditions, including
approval of the merger by the shareholders of PTI. The combined
company is expected to trade on the NASDAQ Global Market under the
ticker symbol YMTX.
In conjunction with this merger announcement, PTI has reduced
its workforce by 79%. As of today, PTI has five full time
employees supporting the proposed merger transaction and strategic
efforts related to PTI's CF assets.
MTS Health Partners, L.P. is serving as the exclusive financial
advisor to PTI and Cooley LLP is serving as legal counsel to
PTI. Goodwin Procter LLP is serving as legal counsel for
Yumanity.
Conference Call and Webcast
PTI and Yumanity will host a conference call and webcast to
discuss the proposed transaction as well as Yumanity's drug
discovery platform and development pipeline today, August 24 at 8:00 a.m.
ET. The live webcast can be accessed on the Events &
Presentations page of Yumanity's and PTI's websites or by dialing
(844) 534-7315 (U.S.) or (574) 990-3007. The conference ID for the
live call is 8351758. The conference call and webcast will include
presentation slides that can be viewed through the webcast. An
archived replay of the webcast will be available on the Yumanity
and PTI websites.
About Proteostasis Therapeutics, Inc.
Proteostasis Therapeutics, Inc. is a clinical stage
biopharmaceutical company developing small molecule therapeutics to
treat cystic fibrosis and other diseases caused by dysfunctional
protein processing. Headquartered in Boston, MA, the Proteostasis Therapeutics team
focuses on identifying therapies that restore protein function. For
more information, visit www.proteostasis.com.
About Yumanity Therapeutics, Inc.
Yumanity Therapeutics is a clinical-stage biopharmaceutical
company that is accelerating the revolution in the treatment of
neurodegenerative diseases through its transformative scientific
foundation and drug discovery platform. The Company's most advanced
product candidate, YTX-7739, is currently in Phase 1 clinical
development for Parkinson's disease. Yumanity's drug discovery
platform allows the Company to rapidly screen for disease-modifying
therapies to overcome toxicity of misfolded proteins in
neurogenerative diseases. Yumanity's growing pipeline consists of
additional programs focused on Lewy body dementia, amyotrophic
lateral sclerosis (ALS), and Alzheimer's disease. For more
information, please visit www.yumanity.com.
Additional Information about the Merger and Where to Find
It
This communication may be deemed to be solicitation material in
respect of the proposed transaction between Proteostasis
Therapeutics, Inc. ("Proteostasis"), Yumanity Holdings, LLC
("Holdings") and Yumanity Therapeutics, Inc. ("Yumanity"). In
connection with the proposed transaction, Proteostasis will file
relevant materials with the Securities and Exchange Commission
("SEC"), including a registration statement on Form S-4 that will
contain a prospectus and a proxy statement. Proteostasis will mail
the proxy statement/prospectus to Proteostasis stockholders, and
the securities may not be sold or exchanged until the registration
statement becomes effective. Investors and security holders
of Proteostasis, Holdings and Yumanity are urged to read these
materials when they become available because they will contain
important information about Proteostasis, Holdings and Yumanity and
the merger. This communication is not a substitute for the
registration statement, definitive proxy statement/prospectus or
any other documents that Proteostasis may file with the SEC or send
to stockholders in connection with the proposed transaction.
Investors and security holders may obtain free copies of the
documents filed with the SEC on Proteostasis' website at
http://www.proteostasis.com, by contacting Proteostasis' Investor
Relations at (617) 225-0096 or the SEC's website at www.sec.gov.
Investors and security holders are urged to read the proxy
statement, prospectus and other relevant materials when they become
available before making any voting or investment decision with
respect to the merger.
This communication shall not constitute an offer to sell or the
solicitation of an offer to sell or the solicitation of an offer to
buy any securities, nor shall there be any sale of securities in
any jurisdiction in which such offer, solicitation or sale would be
unlawful prior to registration or qualification under the
securities laws of any such jurisdiction. No offering of securities
shall be made except by means of a prospectus meeting the
requirements of Section 10 of the Securities Act of 1933, as
amended.
Participants in the Solicitation
Proteostasis and its directors and executive officers, Holdings
and its directors and executive officers, and Yumanity and its
directors and executive officers may be deemed to be participants
in the solicitation of proxies from the stockholders of
Proteostasis in connection with the proposed transaction.
Information about the executive officers and directors of
Proteostasis is set forth in Proteostasis' Definitive Proxy
Statement on Schedule 14A relating to the 2020 Annual Meeting of
Stockholders, filed with the SEC on April
29, 2020. Other information regarding the interests of such
individuals, as well as information regarding Holdings' directors
and executive officers and Yumanity's directors and executive
officers, will be set forth in the proxy statement/prospectus,
which will be included in Proteostasis' registration on Form S-4
when it is filed with the SEC. You may obtain free copies of these
documents as described in the preceding paragraph.
Proteostasis Forward-Looking Information
This press release contains forward-looking statements based
upon Proteostasis', Holdings' and Yumanity's current expectations.
Forward-looking statements involve risks and uncertainties, and
include, but are not limited to, statements about the structure,
timing and completion of the proposed merger; the combined
company's listing on Nasdaq after closing of the proposed merger;
the timing and results of planned preclinical studies or clinical
trials of Yumanity's product candidates; the timing and status of
partnership discussions for Proteostasis' CF program including any
grant, sale or transfer of rights related to its proprietary CFTR
modulators; the conditions under which payment under the CVRs will
be met; expectations regarding the ownership structure of the
combined company; each individual company's or the combined
company's expected cash position at the closing of the proposed
merger; the future operations of the combined company, including
with respect to the continued development of Yumanity's clinical
pipeline; the nature, strategy and focus of the combined company;
the development and commercial potential and potential benefits of
any product candidates of the combined company; the executive and
board structure of the combined company; the location of the
combined company's corporate headquarters; anticipated preclinical
and clinical drug development activities and related timelines,
including the expected timing for data and other clinical and
preclinical results; Yumanity having sufficient resources to
advance its pipeline; and other statements that are not historical
fact. Actual results and the timing of events could differ
materially from those anticipated in such forward-looking
statements as a result of these risks and uncertainties, which
include, without limitation: (i) the risk that the conditions to
the closing of the proposed merger are not satisfied, including the
failure to timely obtain stockholder approval for the transaction,
if at all; (ii) uncertainties as to the timing of the consummation
of the proposed merger and the ability of each of Proteostasis,
Holding and Yumanity to consummate the proposed merger; (iii) risks
related to Proteostasis' ability to manage its operating expenses
and its expenses associated with the proposed merger pending
closing; (iv) risks related to the failure or delay in obtaining
required approvals from any governmental or quasi-governmental
entity necessary to consummate the proposed merger; (v) the risk
that as a result of adjustments to the exchange ratio, Proteostasis
stockholders and Yumanity stockholders could own more or less of
the combined company than is currently anticipated; (vi) risks
related to the market price of Proteostasis' common stock relative
to the exchange ratio; (vii) unexpected costs, charges or expenses
resulting from the transaction; (viii) potential adverse reactions
or changes to business relationships resulting from the
announcement or completion of the proposed merger; (ix) risks
related to the inability of the combined company to obtain
sufficient additional capital to continue to advance preclinical
programs and clinical trials; (xi) uncertainties in obtaining
successful clinical results for product candidates and unexpected
costs that may result therefrom; (xii) risks related to the failure
to realize any value from product candidates and preclinical
programs being developed and anticipated to be developed in light
of inherent risks and difficulties involved in successfully
bringing product candidates to market; (xiii) the risk that the
conditions to payment under the CVRs will be not be met and that
the CVRs may otherwise never deliver any value to Proteostasis
stockholders; and (xiv) risks associated with the possible failure
to realize certain anticipated benefits of the proposed merger,
including with respect to future financial and operating results.
Actual results and the timing of events could differ materially
from those anticipated in such forward-looking statements as a
result of these risks and uncertainties. These and other risks and
uncertainties are more fully described in periodic filings with the
SEC, including the factors described in the section titled "Risk
Factors" in Proteostasis' Quarterly Report on Form 10-Q for the
quarter ended June 30, 2020 filed
with the SEC, and in other filings that Proteostasis makes and will
make with the SEC in connection with the proposed transactions,
including the proxy statement/prospectus described above under
"Additional Information about the Proposed Merger and Where to Find
It." You should not place undue reliance on these forward-looking
statements, which apply only as of the date of this press release.
Proteostasis expressly disclaims any obligation or undertaking to
release publicly any updates or revisions to any forward-looking
statements contained herein to reflect any change in its
expectations with regard thereto or any change in events,
conditions or circumstances on which any such statements are
based.
Proteostasis Contacts
Investors:
David Pitts
/ Claudia Styslinger
Argot Partners
212.600.1902
david@argotpartners.com / claudia@argotpartners.com
Media:
David Rosen
Argot Partners
212.600.1902
david.rosen@argotpartners.com
Yumanity Contacts
Investors:
Burns McClellan, Inc.
Steve Klass
sklass@burnsmc.com
(212) 213-0006
Media:
Burns McClellan, Inc.
Ryo Imai / Robert Flamm, Ph.D.
rimai@burnsmc.com / rflamm@burnsmc.com
(212) 213-0006
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SOURCE Proteostasis Therapeutics, Inc.
