The SPAC announced it is merging with medical technology company ProKidney LP, in a deal that values the combined equity of the companies at $2.64 billion.
On Tuesday, a SPAC backed by Chamath Palihapitiya and Suvretta Capital announced it is merging with medical technology company ProKidney LP in a deal that values the combined equity of the companies at $2.64 billion.
Through the merger with SPAC Social Capital Suvretta Holdings Corp III, ProKidney will receive $825 million to fund Phase III development of a cell therapy designed to treat chronic kidney disease with technology it says has the potential to restore organ function using the patient’s kidney cells and, ultimately, prepare for a global commercial launch.
In addition, the transaction between Social Capital Suvretta Holdings Corp. III and ProKidney includes a private-public equity investment, or PIPE, of $575 million. Investors in the PIPE include Palihapitiya’s Social Capital with $125 million investment, Suvretta Capital’s healthcare-focused fund Averill with about $30 million and $50 million from ProKidney’s existing shareholders.
ProKidney was founded by a group of investors led by Pablo Legorreta, the founder and chief executive officer of Royalty Pharma Plc. The company is developing a first-of-its-kind, patented disease-modifying autologous cell therapy to treat chronic kidney disease. Its lead product candidate, REACT, has the potential to slow, stabilize, and even reverse the decline in kidney function, delaying the onset of dialysis and potentially delivering significant cost savings to healthcare systems globally.
Tim Bertram, founder and CEO of ProKidney, is excited to have ProKidney entering this critical stage of the company’s journey. “ProKidney can help usher in a new era of better health for millions of chronic kidney disease patients living with the fear of kidney failure and a life on dialysis,” Bertram said in a statement.
By taking ProKidney public, Palihapitiya regards the partnership as a step forward in changing how we treat CKD, and clinical data shows its treatment cannot only significantly slow the onset of CKD compared to existing therapies but even reverse the loss of kidney function, a first for CKD patients.
“For decades, healthcare providers have been limited to addressing the symptoms of chronic kidney disease—largely through burdensome regimens like dialysis—with no cure for the underlying disease ... ProKidney has the opportunity to change the way we approach and treat chronic kidney disease,” Palihapitiya said in the statement.
Gross proceeds from the deal also include the $250 million the company raised in an initial public offering (IPO) in July, where each SPACs target a different subsector within biotechnology: neurology, oncology, organs and immunology.
If ProKidney succeeds with its lead product candidate REACT, it could rack up big sales for the company. The deal is expected to close in the third quarter of this year, after which the new company will be listed on Nasdaq under the symbol “PROK.”
