Gary Glick (Scorpion Therapeutics)

UP­DAT­ED: Se­r­i­al en­tre­pre­neur Gary Glick sells an­oth­er one of his star­tups for $229M — this time to an un­like­ly buy­er

Gary Glick has proven him­self, time and again, a nifty start­up artist. Af­ter sell­ing Lyc­era to Cel­gene, he held a streak for IFM Ther­a­peu­tics — carv­ing a plate of in­flam­ma­tion pro­grams each time and turn­ing the re­sult­ing sub­sidiary over to Big Phar­ma, while keep­ing the core dis­cov­ery unit — and more re­cent­ly lined up $270 mil­lion for pre­ci­sion on­col­o­gy work at Scor­pi­on.

James Sapirstein

His lat­est deal, though, looks a bit dif­fer­ent.

Glick has sold First Wave Bio to Azur­Rx, a pen­ny stock biotech un­til a re­verse stock split on Fri­day pushed shares $AZRX back up. The stock has since slid down 11.76% to $4.81. The ma­jor­i­ty of the $229 mil­lion deal is in stock — with on­ly $18 mil­lion in cash — and as a re­sult, he will hand over the name, as­sets and con­trol to Azur­Rx CEO James Sapirstein.

Still, it ap­pears to be a good enough deal for Glick. The on­ly Form D First Wave has filed, dat­ed 2018, shows it set out to raise at most $5 mil­lion and had sold at least $2.6 mil­lion worth of eq­ui­ty pri­vate­ly.

First Wave was start­ed around the same time as IFM, Glick told End­points News, based on his old­er aca­d­e­m­ic work on im­mune me­tab­o­lism.

“So the com­pa­ny, un­like the oth­er com­pa­nies I start­ed, was not ven­ture-backed,” he said. “This is a com­pa­ny that was some­what self-fi­nanced with the group of in­di­vid­u­als who have helped start all of my com­pa­nies, and the goal was to run a very lean op­er­a­tion, very fo­cused op­er­a­tion, vir­tu­al­ly. There were nev­er any em­ploy­ees in the com­pa­ny, there were a few of us that con­sult­ed for the com­pa­ny and (got) eq­ui­ty as well.”

At the heart of the re­verse merg­er are the new for­mu­la­tions that First Wave has de­vised for niclosamide, an an­tipar­a­sitic drug ap­proved by the FDA to treat tape­worm in­fes­ta­tions. These small mol­e­cule for­mu­la­tions are gut-re­strict­ed, open­ing up a range of ap­pli­ca­tions in­clud­ing in­flam­ma­to­ry bow­el dis­ease — and they had some pos­i­tive clin­i­cal re­sults to back it up.

That caught the at­ten­tion of Azur­Rx, which spe­cial­izes in tar­get­ed, non-sys­temic ther­a­pies for gas­troin­testi­nal dis­eases.

“We have been talk­ing to First Wave for a very long time,” said Sapirstein, who not­ed he’s known Glick since their col­lege days.

Then came the Covid-19 pan­dem­ic, and sci­en­tif­ic find­ings out of Ko­rea that niclosamide — a wide­ly avail­able drug list­ed by the WHO as an es­sen­tial med­i­cine — may be a “game chang­er” as an an­tivi­ral. The serendip­i­tous de­vel­op­ment meant the val­ue of First Wave’s pro­grams bal­looned so much that Azur­Rx couldn’t quite af­ford the deal it was orig­i­nal­ly en­vi­sion­ing.

So this Jan­u­ary, the com­pa­nies set­tled for a li­cens­ing deal around two in­di­ca­tions: Covid-19 re­lat­ed GI in­fec­tions and im­mune check­point in­hibitor-as­so­ci­at­ed col­i­tis and di­ar­rhea in ad­vanced stage can­cer pa­tients.

James Pen­ning­ton

Four months in­to the Covid-19 study, Azur­Rx made the de­ci­sion to just snap it all up — and change its name to First Wave. Its pipeline will now ex­pand to in­clude three clin­i­cal IBD in­di­ca­tions in ul­cer­a­tive proc­ti­tis and ul­cer­a­tive proc­tosig­moidi­tis, ul­cer­a­tive col­i­tis and Crohn’s dis­ease.

“There is a wealth of clin­i­cal da­ta that sup­ports the an­tivi­ral and an­ti-in­flam­ma­to­ry ca­pa­bil­i­ties of niclosamide,” said James Pen­ning­ton, Azur­Rx CMO. “More re­cent­ly, da­ta gen­er­at­ed by First Wave Bio in ul­cer­a­tive proc­ti­tis sup­port­ed the broad­er po­ten­tial for niclosamide in mul­ti­ple in­flam­ma­to­ry bow­el dis­eases where we be­lieve our niclosamide for­mu­la­tions could of­fer sig­nif­i­cant ad­van­tages over oth­er cur­rent­ly avail­able treat­ments in­clud­ing steroids, 5-ASAs, and bi­o­log­ics – es­pe­cial­ly in the mild-to-mod­er­ate dis­ease stage.”

Sapirstein added that the new First Wave will al­so in­her­it the old First Wave’s man­u­fac­tur­ing process and set­up, al­low­ing for quick scale up.

Oth­er than niclosamide, First Wave will keep Azur­Rx’s lead Phase IIb pro­gram, MS1819, a po­ten­tial treat­ment for se­vere ex­ocrine pan­cre­at­ic in­suf­fi­cien­cy in pa­tients with cys­tic fi­bro­sis.

For Glick, the sale al­lows him to fo­cus on oth­er ven­tures — and the next big thing he’s work­ing on.

Ed­i­tor’s Note: This sto­ry has been up­dat­ed to add com­ments by Gary Glick.

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