Amicus Therapeutics Spins Off Its Gene Therapy Unit in a SPAC Deal

Philadelphia-based Amicus Therapeutics has had a tough 2021, with their stock falling more than 55% year-to-date. This plunge in price was driven by the failure of AT-GAA, their therapy for late-onset Pompe disease, to meet its primary endpoint in a Phase 3 clinical trial. However, Amicus decided to push forward with its plans to seek approval of AT-GAA, citing improvements in other measurements.

On a day with good news all around, Amicus announced that the FDA accepted the filing for AT-GAA, it had secure funding, and they would spin off their gene-therapy unit in a SPAC deal. The news sent the stock over 10% higher in pre-market. Although, the stock closed 5.2% lower.

SPAC Deal Set to Create Caritas Therapeutics

Amicus specializes in creating treatments for human genetic diseases. Their most advanced products include Galafold, which is FDA-approved for the treatment of Fabry disease, and AT-GAA, a two-component investigational therapy for the treatment of Pompe disease. 

On Sep 29th, the FDA accepted for review the Biologics License Application (BLA) and New Drug Application (NDA) for both components of AT-GAA. Responses for these applications are expected in mid-2022.

Additionally, Amicus announced that ARYA Science Acquisition IV, a SPAC, would acquire its gene therapy business. The merger would result in the creation of a new company named Caritas Therapeutics. The new company will focus on developing next-generation genetic medicines for rare diseases.\

After their acquisition, their pipeline will be led by two Batten disease programs. The acquisition will provide approximately $400 million in funding to Caritas, which includes $150 million from ARYA’s trust account, $200 million from the sale of stock in a PIPE investment, and $50 million from Amicus.

Amicus will be the majority shareholder of the new company with around 38% ownership. It will maintain rights to co-develop and commercialize existing Fabry and Pompe gene therapies and 50/50 cost and profit share. Additionally, it will hold the rights to the first negotiation for some multiple muscular dystrophy programs. After the acquisition, John F. Crowle, current CEO of Amicus, will transition and serve as Chairman and CEO of Caritas. The current COO of Amicus would take over as CEO of Amicus.

Additionally, Amicus announced a “syndicate of leading healthcare biotechnology investors” would invest $200 million. Together these transactions move Amicus closer to profitability, which is expected in 2023.

“This transaction will transform Amicus into a premier rare disease global commercialization and late-stage product development company that we believe will benefit all of our stakeholders,” said Bradley Campbell, President and Chief Operating Officer of Amicus. 

“The separation strengthens the financial profile of Amicus and accelerates our path to profitability while preserving significant equity ownership in the gene therapy pipeline and commercial rights to the innovative and important Fabry and Pompe gene therapy programs. We will be laser-focused on maintaining the growth of Galafold and executing on the anticipated global launch of AT-GAA as we build Amicus into a leading global rare disease biotechnology company and bring our medicines to as many patients as quickly as possible.”

Author

Daniel Ojeda