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Better late than never
SAN CARLOS, Calif.—Hoping to capitalize on one company's near-term commercial opportunity and the other company's mid-stage pipeline drug, ARCA biopharma Inc., a privately-held developer of genetically-targeted cardiovascular disease therapies, and Nuvelo Inc., a publicly traded drug developer focused on cardiovascular disease and cancer, announced in late September they have entered into a definitive merger agreement.
The merger is expected to create a late-stage cardiovascular biotechnology company with near-term commercial opportunity in ARCA's Gencaro product, a genetically-targeted beta blocker, and Nuvelo's mid-stage pipeline asset NU172, a short-acting anticoagulant.
Under the terms of the agreement, Dawn Acquisition Sub, a wholly owned subsidiary of Nuvelo, will merge with ARCA, and ARCA will become a wholly owned subsidiary of Nuvelo.
Richard Brewer, president and CEO of ARCA, says the merger offers "cash, products and people" to the company, which produced one of the first DNA databases and is developing a genetic test for Gencaro. The genetically-targeted beta blocker has shown unique vasodilating properties and has been accepted for FDA review with a PDUFA date of May 31, 2009. Pending regulatory approval, the companies plan to commercialize Gencaro in the first half of 2010.
"Not only are we creating a public company, but we are creating a public company that is well-funded with assets going to the FDA for approval, which for our shareholders is a nice circumstance," Brewer says. "I also think the merger is unique from the point of view that we are developing the first personalized medicine and companion diagnostic test. This is something patients want and something the FDA likes a lot, as well, considering it has its own personalized medicine initiative and is encouraging companies to develop drugs along these lines."
Ted Love, chairman and CEO of Nuvelo—who once worked with Brewer at Genentech—says the merger brings both immediate and longer-term value to the company's stockholders. NU172 is being tested as a potential new therapy in indications where heparin and protamine are the current standard of care, such as coronary artery bypass graft (CABG) surgery, kidney dialysis and a variety of vascular surgical and coronary interventions. A Phase II trial evaluating NU172 in CABG patients is expected to begin in the fourth quarter of 2008 or the first quarter of 2009.
"After thorough review of numerous options, we chose to merge with ARCA because it enables us to transform ourselves into a late-stage company with multiple significant milestones and a near-term commercialization opportunity, backed by a promising cardiovascular pipeline," Love says.
Financial terms of the deal were not disclosed. The transaction is expected to close at the end of this year or early 2009.