After raising $20 million and laying out plans for a Phase III pivotal trial of a reformulated antibiotic, Savara is getting the new year underway with a public listing, courtesy of a reverse merger with the zombie biotech Mast Therapeutics.
Mast had already fallen into penny stock status last September when the company $MSTX was forced to concede that its Phase III study of a new drug for sickle cell disease had failed, leaving the San Diego-based biotech with few remaining options.
On Friday, just ahead of the news that Savara would merge with Mast and reverse its way into public company status through the shell, Mast’s stock was trading at a mere 10 cents a share.
Austin-based Savara has been working on AeroVanc, a dry powder formulation of vancomycin to treat MRSA infections in cystic fibrosis patients. According to its website, the Phase III was slated to begin this quarter. But in the release, the biotech says the start will now be scheduled for Q3. Savara has also been working on two other clinical stage programs for reformulated drugs.
Savara used a $115 million valuation in the deal, assigning $36.5 million for Mast’s remaining value. Savara plans to list on the NYSE under a new stock symbol.
Reverse mergers have become popular in recent months as biotechs skidded into a series of disasters. Just before Christmas, there were two reverse mergers in one day as Tokai opened the door to Optic and Dipexium handed over its shell to PLx.
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