Drug companies reach $260M settlement just ahead of opioid trial; Oyster Point set terms for $85M IPO
→ Hours before the first federal opioid trial was set to begin, three drug distributors and an opioid manufacturer agreed to a $260 million agreement settlement, the Wall Street Journal was the first to report. The deal — which will see McKesson, Cardinal Health and AmerisourceBergen pay $215 million to Summit and Cuyahoga counties, and Teva deal out $35 million in cash and addiction treatments — does not resolve the pending, nationwide litigation that may result in a settlement worth upwards of $40 billion. Negotiators in that case, brought by 2,300 tribes, counties and cities nationwide and led by several states’ attorneys general, worked through much of Friday without success. Josh Stein, the attorney general for North Carolina, said they were trying to put together a $48 billion deal.
→ Oyster Point Pharma has announced the terms for its IPO, which will help advance a nasal spray formulation for dry eye disease. The Princeton, NJ-based company is planning to offer 5 million shares at a price range of $16 to $18 to raise $85 million. At the midpoint of the proposed range, it would command a fully diluted market value of $385 million. The joint bookrunners of the deal are JP Morgan, Cowen and Piper Jaffray. The biotech plans to list under the symbol $OYST and is expected to price on Wednesday.
→ The board of directors at Aerpio Pharmaceuticals is initiating the process to explore strategic alternatives, which can be anything from acquisition, company sale, merger, business combination, asset sale, in-license, out-license to other strategic transaction. The company’s clinical assets— compounds that activate Tie2 to treat ocular disease and diabetic complications — and cash resources amounted to $48.2 million as of June 30, 2019. Evercore, Ladenburg Thalmann & Co and Duane Nash have been brought on as advisors. Meanwhile, Aerpio is streamlining its operations to conserve resources, with CEO Stephen Hoffman and CFO Michael Rogers first to head out the door. The management team will now be led by current president Joseph Gardner along with the company’s vice president of finance Gina Marek.
→ Barbara Fox will be the next CEO of immunometabolism startup Rheos Medicine. Fox served at the helm of Tilos Therapeutics, the anti-LAP antibody company that scored a $773 million deal with Merck. Rheos — which emerged from stealth mode in 2018 with $60 million in funding — aims to use research on cells’ metabolism to develop therapies for autoimmune disorders. The company has been without a permanent CEO since Sanjay Keswani, a former top Roche scientist, left in June, after less than one year at the helm.