Troubled Dimension Therapeutics Sold in All-Stock Deal
August 25, 2017
By Alex Keown, BioSpace.com Breaking News Staff
ROCKVILLE, Md. – Shares of beleaguered Dimension Therapeutics are soaring more than 160 percent in premarket trading after gene therapy company Regenxbio Inc. announced it struck an all-stock deal to acquire it.
Regenxbio picked up the company months after Dimension revealed interim data results from its Phase I/II hemophilia B study of drug candidate DTX101 that showed questionable safety issues regarding its therapy. But it’s not the failed treatment that Regenxbio had its eyes on, rather it was two other drug candidates, DTX301 and DTX401. Regenxbio said those two candidates will be added to its pipeline. DTX301 is being developed for the treatment of ornithine transcarbamylase (OTC) deficiency. The drug candidate is designed to deliver a copy of the OTC gene to liver cells. It is in Phase I/II development.
Dimension’s DTX401 is being developed for the treatment of glycogen storage disease type Ia (GSDIa). DTX401 is designed to use the NAV AAV8 vector to deliver a copy of the glucose-6-phosphatase (G6Pase) gene to liver cells. Regenxbio said it will file an investigational new drug application for DTX401 in early 2018.
Both DTX301 and DTX401 have been granted Orphan Drug Designation in the United States and Europe.
Additionally Regenxbio said it is interested in developing DTX201 for the treatment of hemophilia A. DTX201 is designed to use REGENXBIO’s NAV Technology to deliver a copy of the Factor VIII gene to liver cells, and is partnered through a global development and commercialization collaboration with Bayer. An IND application is anticipated to be filed for DTX201 in early 2018.
Regenxbio also picks up preclinical candidates for phenylketonuria (PKU), Wilson disease and citrullinemia type I.
Ken Mills, president and chief executive officer of Regenxbio, said DTX301 and DTX401 are product candidates that address diseases with high unmet need and will become an important part of the company’s “strong internal pipeline.” The two drug candidates are expected to achieve multiple milestones over the course of the next year, he said “The acquisition of Dimension is another meaningful step in building a robust clinical pipeline of gene therapy product candidates with the goal of improving treatment options for patients and families in many diseases,” Mills said in a statement. He added that it also demonstrates Regenxbio’s leadership in the field of AAV (adeno-associated viral) gene therapy.
Shares of Dimension hit $3.20 in early trading after closing at $1.20 per share on Thursday. Under terms of the deal, Regenxbio is acquiring Dimension for an implied value of approximately $3.41 per share. The deal is expected to close by the end of 2017, Regenxbio said in its announcement. Pegging the stock at $3.41 puts a value on Dimension of about $86 million, well below what its market value was two years ago when it was trading at $13.88 per share in November 2015. The company went public in October of 2015. After hitting the high mark a month later, share prices for Dimension have steadily declined.
When the deal is finalized, Dimension will become a wholly-owned subsidiary of Regenxbio. In the announcement, the company did not specify if the acquisition would impact employees or leadership at the Cambridge, Mass.-based company. In June, Dimension axed 25 percent of its employees.