Galena Biopharma (Nasdaq: GALE) and Sellas Life Sciences Group, a privately-held Swiss/Greek oncology-focused company, have entered into an all stock definitive merger agreement under which Sellas will merge into and become an indirect, wholly-owned subsidiary of Galena.
The combined company will be renamed Sellas Life Science Group Inc. The merger will result in a combined company focused on the development of novel treatments for cancer.
On January 31, 2017, Galena announced the initiation of a process to explore a range of strategic alternatives focused on maximizing shareholder value. After a thorough review of available alternatives, and extensive diligence and negotiation with Sellas, Galena’s board of directors unanimously approved to enter into a definitive merger agreement with Sellas.
Under the terms of the merger agreement, existing Sellas shareholders will receive newly-issued shares of Galena common stock. On a pro forma basis, assuming completion of the proposed merger, Galena stock and warrant holders are expected to own around 32.5%, and Sellas shareholders will own about 67.5% of the combined company. The proposed merger is expected to close in the fourth quarter of 2017, subject to the approval of Galena stockholders and other customary closing conditions.
The combined company will feature a late-stage pipeline led by novel immunotherapies targeting a broad range of indications in hematology and solid tumors. Sellas licenses the rights to its lead asset, galinpepimut-S, (GPS), a novel WT1 antigen-targeting immunotherapy. GPS is initially being developed for the treatment of acute myeloid leukemia (AML) and is Phase III-ready in this setting.
Sellas has also successfully completed a Phase II study of GPS in malignant pleural mesothelioma (MPM), and its end-of-Phase II meetings with the US Food and Drug Administration for GPS in both indications. For both AML and MPM, Sellas has been granted orphan drug designation from the FDA and the European Medicines Agency and been given FDA fast track status. In addition, Sellas is currently conducting two Phase II trials of GPS in multiple myeloma, as well as a combination trial in ovarian cancer with nivolumab (Opdivo, from Bristol-Myers Squibb), and is currently preparing for additional combination trials for GPS in combination with another checkpoint inhibitor.
Galena’s lead immunotherapy program, NeuVax (nelipepimut-S), is currently in three, Phase II, investigator-sponsored clinical trials in breast cancer, and these trials will remain ongoing. Galena’s other development programs, GALE-401, a controlled release version of anagrelide that is Phase III-ready, and GALE-301/GALE-302, an earlier stage cancer immunotherapy program targeting folate binding protein, are currently being evaluated for potential internal development or strategic partnership.