As Neuphoria Therapeutics considers its options in the wake of the failure of its phase 3 social anxiety program, an investor has swooped in with one potential escape route.
Lynx1 Master Fund, a Puerto Rico-based hedge fund manager that already invests in U.S. biotechs—including Neuphoria—contacted the company yesterday to inquire about buying "all of the outstanding shares of Neuphoria that it does not already own" for $5.20 each in cash, the biotech said in a Nov. 11 release.
The offer is only slightly above the $4.90 the company's shares closed at Monday, with the stock having plunged from $15 in October on the back of disappointing clinical data.
That readout saw Neuphoria’s lead candidate, an α7 nicotinic receptor negative alteration modulator called soclenicant, fail to improve social anxiety symptoms in a late-stage trial. The Massachusetts-based biotech responded to the fail by discontinuing the social anxiety program and launching a strategic review of its business.
Neuphoria reiterated in this morning’s release that this review will encompass anything from a merger or company sale to partnerships, joint ventures or licensing deals. One of the options now on the table is the buyout from Lynx1 Master Fund, and it sounds like the biotech is taking the offer seriously.
“Consistent with its fiduciary duties and responsibilities, Neuphoria’s board of directors will, in consultation with its financial and legal advisors, carefully evaluate and consider this indication of interest in connection with its review of strategic alternatives, and its ongoing review of a broad range of opportunities aiming to enhance stockholder value through strategic, financial and operational measures,” the company said in the release.
Part of the investor’s offer involves nominating individuals for election to Neuphoria’s board at the biotech’s annual meeting of stockholders in December. Neuphoria said it would “review the proposed director nominees and present the board of directors’ recommendation” to the biotech’s stockholders ahead of the meeting.
Neuphoria ended June with $14.2 million in cash and cash equivalents, which was expected to keep the lights on until the second quarter of 2027.
Announcing the social anxiety failure last month, Neuphoria said it planned to assess next steps for soclenicant in post-traumatic stress disorder, citing “previous positive data with chronic daily dosing.”
The biotech has an ongoing partnership with Merck & Co. to advance two positive allosteric modulator candidates, one of which is currently being tested out in a Merck-led phase 2 study for Alzheimer’s disease. Merck is fronting the costs of the program, with Neuphoria in line to receive up to $450 million in potential biobucks.
Neuphoria also has a deal with Carina Biotech to develop a legacy oncology program.