Essa Pharma Inc. to be Acquired by XenoTherapeutics in All-Cash Transaction
In a significant development for the biotechnology sector, ESSA Pharma Inc., a Vancouver-based company specializing in small molecule drugs for prostate cancer treatment, has announced a definitive agreement to be acquired by XenoTherapeutics, Inc. This transaction, backed by XOMA Royalty Corporation, marks a pivotal moment for ESSA Pharma, which has been navigating the challenges of the biotech industry with a focus on innovative cancer therapies.
The acquisition, structured as an all-cash transaction, involves XenoTherapeutics, a non-profit biotechnology company, acquiring all issued and outstanding common shares of ESSA Pharma. XOMA Royalty Corporation, known for its role as a biotechnology royalty aggregator, is acting as the structuring agent and will provide the necessary financing for this transaction.
Under the terms of the Business Combination Agreement, ESSA Pharma shareholders are set to receive a cash payment per common share. This payment will be determined based on ESSA’s cash balance at closing, after accounting for certain transaction costs, a reserve for liabilities and legal expenses, and a transaction fee, collectively referred to as the “Final Cash Amount.” Additionally, each shareholder will receive one non-transferable contingent value right (CVR) for each common share held. These CVRs entitle holders to a pro rata portion of up to US$2,950,000, or up to US$0.06 per CVR, within 18 months following the transaction’s closure.
This strategic move is expected to expedite the distribution of cash to ESSA Pharma shareholders, providing them with immediate financial benefits while also offering potential future gains through the CVRs. The acquisition by XenoTherapeutics, supported by XOMA Royalty Corporation, underscores the growing interest and investment in biotechnology companies focused on developing innovative treatments for critical health issues like prostate cancer.
As ESSA Pharma transitions under the new ownership of XenoTherapeutics, the company’s focus on developing small molecule drugs for prostate cancer treatment will continue to be a priority. This acquisition not only provides ESSA Pharma with the resources and support needed to advance its research and development efforts but also highlights the importance of strategic partnerships in the biotechnology sector.
The transaction is a testament to the dynamic nature of the biotechnology industry, where companies like ESSA Pharma are at the forefront of developing groundbreaking therapies. With the backing of XenoTherapeutics and XOMA Royalty Corporation, ESSA Pharma is poised to make significant strides in its mission to combat prostate cancer, offering hope to patients and their families worldwide.
As the biotechnology sector continues to evolve, this acquisition serves as a reminder of the critical role that strategic partnerships and investments play in advancing medical research and development. For ESSA Pharma, this marks the beginning of a new chapter, one that promises to bring innovative treatments to market and make a lasting impact on the fight against prostate cancer.