PharmAthene, Theraclone deal

Biodefense company PharmAthene terminated a July agreement with antibody company Theraclone to merge in a stock deal. PharmAthene will pay Theraclone a $1 million termination fee. PharmAthene would have been the surviving entity, of which Theraclone would have owned 50%. PharmAthene cancelled a Dec. 3 meeting in which stockholders would have voted on the deal. At June 30, PharmAthene had $15.8 million in cash and a six-month operating loss of $2.6 million (see BioCentury, Aug. 5).

In November, PharmAthene shareholder Prescott Group urged stockholders to vote against the merger. Prescott, which owns 10% of the company, noted that last month HHS's Biomedical Advanced Research and Development Authority (BARDA) said it did not select Theraclone's TCN-032 for funding. Prescott said BARDA's denial called into question two components PharmAthene's board used to justify the merger: access to non-dilutive government funding and a significant worldwide market opportunity for one of Theraclone's most developed drugs. TCN-032 is a human mAb that specifically binds to a conserved epitope of the amino-terminal extracellular domain (M2e) of influenza A virus matrix protein M2 (M2). Theraclone reported data from a Phase IIa trial with TCN-032 to treat pandemic and severe seasonal influenza in September. Theraclone applied for the government funding to advance TCN-032 into Phase II testing for serious influenza disease. The company said it has requested a meeting with BARDA and is exploring multiple options, including seeking a partner to move TCN-032 to the next stage of development. Zenyaku Kogyo Co. Ltd. (Tokyo, Japan) has exclusive, Japanese rights to Theraclone's influenza mAb program, which includes TCN-032 (see BioCentury, Sept. 16). ...