Avalanche Biotechnologies Inc., (NASDAQ:AAVL), a public biopharmaceutical company based in California with several ophthalmic gene therapy programs in progress, has announced the acquisition of Annapurna Therapeutics S.A.S., a European gene therapy company based in Paris. Annapurna has therapeutic programs in A1AT deficiency, hereditary angioedema and Friedreich’s ataxia. The transaction will result in Avalanche shareholders owning 62.5% of the combined company while Annapurna shareholders will own the remaining 37.5%. Avanlanche suffered a clinical and commercial setback in June 2015 when the results of its wet AMD gene therapy (AVA-101) led to investor queries regarding a number of aspects of the AVA-101 Phase IIa study. AVA-101 is an adeno-associated virus (AAV) vector-based therapy that delivers soluble VEGF receptor 1 to inhibit VEGF while AVA-201 delivers the same gene within a next-generation vector. The company is expected to make a decision in mid-2016 on whether or not to pursue its current wet AMD programs.
Avalanche has stated it will acquire all the outstanding shares of Annapurna in exchange for approximately 17.6 million newly issued shares of Avalanche common stock, valued at approximately $105.6M, based on Avalanche’s closing price of $6/share prior to announcement of the deal. The new combined entity will have a product pipeline comprising Avalanche’s existing ophthalmic programs and four new gene therapy based programs from Annapurna focused on Alpha1-antitrypsin (A1AT) deficiency, cardiomyopathy associated with Friedreich’s ataxia, hereditary angioedema and severe allergies. According to a company press release, Avalanche held approximately $258 million in cash at the end of FY2015, which is expected to sustain all operations for approximately 3 years. The amalgamated company will include Paul B. Cleveland as President and CEO while Amber Salzman, Ph.D., President and CEO of Annapurna will become President and COO with both serving on the combined company’s board of directors.
Commenting on the commercial milestone, Mr. Cleveland stated, “This transaction creates the opportunity to build a leading gene therapy company with an extensive pipeline and significant scientific, financial and human resources. I have tremendous respect for Annapurna’s commitment to high level research and development and we are looking forward to working together to drive our combined current programs forward. At the same time, we are seeking to expand our pipeline further through additional licenses and acquisitions that complement our expertise in vector development and optimization platforms, process development and manufacturing.”