Private oncology outfit Oncternal uses GTx as shell to make Nasdaq debut
Months after declaring it was exploring strategic options following the failure of its lead experimental drug in a mid-stage study involving patients with stress urinary incontinence, GTx has agreed to be the vehicle that private oncology-focused biotech Oncternal Therapeutics is using to leap onto the Nasdaq.
The new firm — to be called Oncternal Therapeutics — will trade under the symbol $ONCT, and Oncternal shareholders will hold three-fourths (75%) of the San Diego, California-based combined entity. Memphis-based GTx’s shares $GTXI shot up roughly 86% (and out of penny stock territory) to hit $1.71 in premarket trading on Thursday.
GTx’s experimental drug, Enobosarm, forms part of a class of compounds called SARMs — non-steroidal molecules that target and modulate the activity of androgen receptors within the cell on the nuclear membrane. Apart from the flop in stress urinary incontinence, the drug is also being evaluated for use in breast cancer. In addition GTx has an undisclosed preclinical drug that comes from a family of compounds called SARDs, which are designed to not only bind to androgen receptors but also degrade the receptor enough to stifle tumor cell proliferation in prostate cancer patients.
Meanwhile, Oncternal Therapeutics has a trio of cancer treatments targeting multiple pathways including a CAR-T drug. Its lead experimental drug, cirmtuzumab, is a monoclonal antibody targeting ROR1 — a transmembrane protein that is believed to play a key role in various blood and solid malignancies — and is being currently evaluated in a mid-stage study involving breast cancer patients.
Under the deal, original Oncternal management will lead the combined entity — with CEO and co-founder James Breitmeyer retaining his post, along with chairman and co-founder David Hale. No GTx employee is expected to remain employed at the combined company; two members of GTx’s board — Robert Wills and Michael Carter — will retain their seats in the combined firm.
The new entity is expected to have capital and investments worth roughly $26 million, if the reverse merger is consummated by the second quarter. This is enough to keep the lights on until the second quarter of 2020 — including funding a a mid-stage study involving cirmtuzumab in combination with J&J’s Imbruvica and planned preclinical studies to support an application to test the SARD compound in humans.