In a move to become a “pure play” RNA company, Altamira Therapeutics is selling off 90% of its Zilentin subsidiary and its inner ear R&D work for the chance to make up to $55 million in biobucks.
The buyer has agreed to acquire 90% of Zilentin’s share capital for an immediate cash consideration of $1 million, a proposal set to close Oct. 28. The buyer also has a second cash payment of $25 million ready to go upon exercising an option to acquire the rest of Altamira’s legacy inner ear therapeutics.
The Swiss company said it will receive $2 million in cash upfront from the buyer, identified only as a “European family office.” Investors appeared to warm to the idea, sending Altamira’s stock up 83% to 60 cents a share by 11 am ET from a closing price on Thursday of 32 cents.
Once the buyer acquires Altamira’s full inner ear development portfolio and brings it under the Zilentin brand, the Swiss pharma will be eligible to receive milestone payments of up to $55 million, along with future royalties.
The new owner will be able to grow Altamira’s projects in hearing loss, tinnitus and vertigo as Altamira shifts strategy, the biotech said. These assets include a phase 2 nasal spray for vertigo called AM-125, and two phase 3 intratympanic treatments for tinnitus and hearing loss called Keyzilen and Sonsuvi.
The Basel, Switzerland-based company’s RNA efforts are currently focused on extrahepatic therapeutic targets, where its work remains preclinical.
“We are excited to take this important first step in the execution of our strategy of becoming a ‘pure play’ RNA delivery technology company,” Altamira CEO Thomas Meyer said in an Oct. 21 release. “While there is a high unmet need and great potential for innovative treatments in inner ear disorders, we consider the future development of our programs in this therapeutic area to be better placed with a different type of owner.”
Meyer is also set to become Zilentin’s CEO within the next six months, while still serving as the principal executive of Altamira.
Altamira’s efforts to spin off its legacy assets don’t stop there though. The company intends to sell off its FDA-approved, over-the-counter nasal spray Bentrio before the end of the year.