AcelRx Pharmaceuticals, headquartered in Redwood City, California, is buying Watertown, Massachusetts-based TetraPhase Pharmaceuticals for $14.4 million.
AcelRx Pharmaceuticals, headquartered in Redwood City, California, is buying Watertown, Massachusetts-based TetraPhase Pharmaceuticals for $14.4 million.
Under the terms of the deal, AcelRx is acquiring Tetraphase stock at an exchange ratio of 0.6303 shares of AcelRx for each share of Tetraphase, or about $14.4 million, plus a contingent value right (CVR). The CVR is based on Xerava (eravacycline for injection) hitting a specific net sales figure beginning in 2021.
The two companies have a co-promotion agreement to commercialize Xerava for complicated intra-abdominal infections (cIAI) and Dsuvia for the management of acute pain in medically supervised settings. That co-promotion deal takes effect immediately and allows the two companies to benefit from the promotion of multiple products, share their customer relationships, and make their commercial teams more efficient as the actual close of the merger moves forward. The combined sales team can cover 35 territories that makeup about 70% of the company’s original targeted hospitals.
“We are excited to have reached agreement with TetraPhase, a company with a well-established US salesforce and a high-growth hospital product that complements AcelRx’s commercial strategy,” said Vince Angotti, chief executive officer of AcelRx. “This transaction highlights our focus on efficiently commercializing Dsuvia with a salesforce promoting multiple products and is the first step in our plan to create a growth platform to further consolidate hospital-focused pharmaceutical companies and products. We look forward to integrating Xerava and the existing TetraPhase commercial infrastructure with our own as we strengthen our position on promoting innovative products to healthcare institutions.”
AcelRx is a specialty pharmaceutical company focused on developing and marketing hospital-based therapies. It has a proprietary, non-invasive sublingual—under the tongue—formulation technology. Its sole approved U.S. product is Dsuvia (Dzuveo in Europe) for the management of acute pain severe enough to require an opioid analgesic for adults in certified medically supervised healthcare settings. It has an additional product candidate, Zalviso (sufentanil sublingual tablet system, SST system, 15 mcg) being developed as a patient-controlled analgesia (PCA) system for decreasing moderate-to-severe acute pain in the medically supervised settings. Both products are approved in Europe.
Xerava is a tetracycline-based antibacterial for complicated intra-abdominal infections (cIAI) in patients 18 years of age and older. It is being studied as part of TetraPhase’s IGNITE Phase III program. In the first pivotal Phase III trial in cIAI, twice-daily intravenous doses of the product showed statistical non-inferiority to ertapenem and were well-tolerated. In the second Phase III trial, it met the primary endpoint by showing statistical non-inferiority to meropenem and was well-tolerated. It had high cure rates in patients with Gram-negative pathogens in both trials, including in antibiotic-resistant infections.
The CVR entitles holders of payments up to an additional $12.5 million in aggregate if Xerava hits net sales in the U.S. of at least $20 million during 2021, $35 million during any year ending on or before December 3, 2024, and $55 million during any year ending on or before December 31, 2024.
After closing, TetraPhase will become a privately held company and its common stock will no longer be listed on a public market.
“This transaction is an important move forward for TetraPhase and more importantly, for Xerva and the patients who need this treatment,” said Larry Edwards, president and chief executive officer of TetraPhase. “We are excited to collaborate with AcelRx, a partner whose strategic goals complement our own. We continue to believe that Xerava is a key addition to the hospital anti-infective armamentarium, and believe that together with AcelRx we will be able to more effectively bring new treatments to patients in healthcare institutions.”
