SAN JOSE, Calif. and
WOODCLIFF LAKE, N.J., Jan. 28, 2020 /PRNewswire/ --BioPharmX
Corporation (NYSE American: BPMX) ("BioPharmX") and
Timber Pharmaceuticals LLC ("Timber"), a privately held
biopharmaceutical company focused on the development and
commercialization of treatments for orphan dermatologic diseases,
today announced that they have entered into a definitive merger
agreement. Under the terms of the merger agreement, subject to the
approval of BioPharmX's stockholders and Timber's members, a
wholly-owned subsidiary of BioPharmX will be merged with and into
Timber, with Timber surviving the merger as a wholly-owned
subsidiary of BioPharmX. As a condition to the closing of the
Merger, Timber has agreed to secure not less than $20 million of financing for the combined
company. The Merger is currently expected to be completed in the
second calendar quarter of 2020. Upon completion of the
Merger, BioPharmX will change its name to Timber Pharmaceuticals,
Inc. and the officers and directors of Timber will become the
officers and directors of BioPharmX.
"We are pleased to reach a merger agreement with BioPharmX,
which provides us with the opportunity once the merger is completed
to have our shares traded in the public market and to expand our
investor base as we strategically build our pipeline in rare
dermatologic diseases that have no approved treatments," said
John Koconis, chief executive
officer of Timber. "This merger also expands our resources and
expertise to build momentum in our development programs targeting
new therapies for underserved patient populations living with some
of the most serious conditions in medical dermatology."
"This transaction with Timber reflects the continued commitment
of our management team and Board of Directors to deliver value to
our stockholders," stated David S.
Tierney, M.D., chief executive officer of BioPharmX.
"Following a comprehensive strategic process led by Locust Walk, a
global life sciences transaction firm, we have determined that a
merger with Timber and the $20
million financing they are bringing to the transaction, will
enable BioPharmX stockholders to participate in Timber's broader
pipeline of drugs to treat rare and orphan dermatological diseases
and is in the best interest of our stockholders."
Timber is currently advancing a late-stage clinical development
pipeline in rare dermatologic diseases, comprising:
- TMB-001, a proprietary topical formulation of isotretinoin
currently being evaluated in a Phase 2b clinical trial for the treatment of moderate
to severe subtypes of congenital ichthyosis (CI), a group of rare
genetic keratinization disorders that lead to dry, thickened, and
scaling skin. A prior Phase 1/2 study involving 19 patients with CI
demonstrated safety and preliminary efficacy of TMB-001, as well as
minimal systemic absorption. In 2018, the U.S. Food & Drug
Administration (FDA) awarded $1.5
million to support clinical trials evaluating TMB-001
through its Orphan Products Grant program.
- TMB-002, a proprietary topical formulation of rapamycin
currently being evaluated in a Phase 2b clinical trial for the treatment of facial
angiofibromas (FAs) in tuberous sclerosis complex (TSC), a
multisystem genetic disorder resulting in the growth of hamartomas
in multiple organs. TSC results from dysregulation in the mTOR
pathway, and as a topical mTOR inhibitor, TMB-002 may address FAs
in TSC without the systemic absorption of an oral agent.
- TMB-003, a proprietary formulation of sitaxsentan, a new
chemical entity in the U.S., which is a selective endothelin-A
receptor antagonist currently in preclinical development as a
topical or subcutaneous agent for the treatment of localized
scleroderma, a rare autoimmune connective tissue disorder (CTD)
that leads to inflammation and thickening of the skin.
Following the closing of the merger, the combined company will
also evaluate BioPharmX's Phase 3 ready proprietary topical
minocycline gel programs for a strategic partnership,
co-development or other non-dilutive value creation strategy. This
product has previously been studied by BioPharmX in the treatment
of inflammatory lesions of acne vulgaris and papulopustular
rosacea.
Under the merger agreement, following the merger, (i) the Timber
members, including the investors funding the $20 million investment, will own approximately
88.5% of the outstanding common stock of BioPharmX, and (ii) the
BioPharmX stockholders will own approximately 11.5% of the
outstanding common stock of BioPharmX, subject to certain
adjustments as more particularly set forth in the merger agreement.
The merger agreement contains customary representations, warranties
and covenants made by BioPharmX and Timber, including covenants
relating to both parties using their best efforts to cause the
transactions contemplated by the merger agreement to be satisfied,
covenants regarding obtaining the requisite approvals of the
BioPharmX stockholders and the Timber members, covenants regarding
indemnification of directors and officers, and covenants regarding
BioPharmX's and Timber's conduct of their respective businesses
between the date of signing of the merger agreement and the closing
of the merger. The merger agreement also contains certain
termination rights for both BioPharmX and Timber, and, in
connection with the termination of the merger agreement under
specified circumstances, BioPharmX and Timber may be required to
pay the other party a termination fee.
In connection with the merger agreement, BioPharmX and Timber
also entered into a credit agreement, pursuant to which Timber has
agreed to make a bridge loan to BioPharmX in an aggregate amount of
$2.25 million. The bridge loan is
secured by a lien on all of BioPharmX's assets. Further, in
connection with the bridge loan, BioPharmX has issued a warrant to
Timber to purchase approximately 2.3 million shares of BioPharmX
common stock at a nominal exercise price. The bridge loan warrant
is exercisable commencing on its issuance and expires 30 months
thereafter.
Further, simultaneous with the execution of the merger
agreement, BioPharmX entered into an agreement with certain holders
of common stock purchase warrants to purchase shares of BioPharmX
common stock to exchange their warrants in a transaction exempt
from registration under Section 3(a)(9) of the Securities Act of
1933. In the exchange, BioPharmX will issue an aggregate of 850,000
shares of common stock to the holders of the warrrants in exchange
for out-of-the money warrants to purchase approximately 2.3 million
shares of BioPharmX common stock which contain language that would
have allowed the holders to convert the warrants into shares of
BioPharmX common stock at the time of the consummation of the
merger based on the "Black Scholes Value" of the warrants at the
time of the consummation of the merger.
Chardan is acting as the financial advisor to Timber in the
proposed transaction and Lowenstein Sandler LLP is acting as its
legal counsel. Locust Walk is acting as the financial advisor to
BioPharmX in the proposed transaction and Akerman LLP is acting as
its legal counsel.
About Timber Pharmaceuticals LLC
Timber Pharmaceuticals is a privately held biopharmaceutical
company focused on the development and commercialization of
treatments for orphan dermatologic diseases. The company's
investigational therapies have proven mechanisms-of-action backed
by decades of clinical experience and well-established CMC
(chemistry, manufacturing and control) and safety profiles. Timber
is initially focused on developing non-systemic treatments for rare
dermatologic diseases including congenital ichthyosis (CI),
tuberous sclerosis complex (TSC), and localized scleroderma. For
more information, visit https://www.timberpharma.com/.
About BioPharmX® Corporation
BioPharmX Corporation (NYSE American: BPMX) is a specialty
pharmaceutical company focused on developing prescription
products utilizing its proprietary HyantX Topical Delivery System
for dermatology indications. To learn more about BioPharmX, visit
www.BioPharmX.com.
Additional Information about the Proposed Merger and Where to
Find It
In connection with the proposed Merger, BioPharmX and Timber
will file relevant materials with the SEC, including a registration
statement on Form S-4 that will contain a prospectus and a proxy
statement of BioPharmX. INVESTORS AND SECURITY HOLDERS OF BIOPHARMX
ARE URGED TO READ THESE MATERIALS CAREFULLY AND IN THEIR ENTIRETY
WHEN THEY BECOME AVAILABLE BECAUSE THEY WILL CONTAIN IMPORTANT
INFORMATION ABOUT BIOPHARMX, TIMBER, THE PROPOSED MERGER, AND
RELATED MATTERS. The proxy statement, prospectus and other relevant
materials (when they become available), and any other documents
filed by BioPharmX with the SEC, may be obtained free of charge at
the SEC website at www.sec.gov. In addition, investors and security
holders may obtain free copies of the documents filed with the SEC
by BioPharmX by directing a written request to: BioPharmX
Corporation, 115 Nicholson Lane, San
Jose, CA 95134. Investors and security holders are urged to
read the proxy statement, prospectus and the other relevant
materials when they become available before making any voting or
investment decision with respect to the proposed merger.
This press release shall not constitute an offer to sell or the
solicitation of an offer to buy any securities or a solicitation of
any vote or approval, nor shall there be any sale of securities in
any jurisdiction in which such offer, solicitation or sale would be
unlawful prior to registration or qualification under the
securities laws of any such jurisdiction. No offering of securities
in connection with the proposed merger shall be made except by
means of a prospectus meeting the requirements of Section 10 of the
Securities Act of 1933, as amended.
Participants in the Solicitation
BioPharmX and its directors and executive officers and Timber
and its directors and executive officers may be deemed to be
participants in the solicitation of proxies from the stockholders
of BioPharmX in connection with the proposed transaction under the
rules of the SEC. Information about the directors and executive
officers of BioPharmX and their ownership of shares of BioPharmX
common stock is set forth in its Annual Report on Form 10-K for the
year ended January 31, 2019, which
was filed with the SEC on March 14,
2019, its proxy statement, which was filed with the SEC on
May 22, 2019, and in subsequent
documents filed with the SEC, including the joint proxy
statement/prospectus referred to above. Additional information
regarding the persons who may be deemed participants in the proxy
solicitations and a description of their direct and indirect
interests in the proposed Merger, by security holdings or
otherwise, will also be included in the joint prospectus/proxy
statement and other relevant materials to be filed with the SEC
when they become available. These documents are available free of
charge at the SEC web site (www.sec.gov) and from BioPharmX at the
address described above. The directors and officers of Timber do
not currently hold any direct or indirect interests, by security
holdings or otherwise, in BioPharmX except pursuant to the bridge
loan warrant.
Forward-Looking Statements
This press release contains forward-looking statements based
upon BioPharmX's and Timber's current expectations. This
communication contains "forward-looking statements" within the
meaning of the Private Securities Litigation Reform Act of 1995.
Forward-looking statements are identified by terminology such as
"may," "should," "expects," "plans," "anticipates," "could,"
"intends," "target," "projects," "contemplates," "believes,"
"estimates," "predicts," "potential" or "continue" or the negative
of these terms or other similar words. These statements are only
predictions. BioPharmX and Timber have based these forward-looking
statements largely on their then-current expectations and
projections about future events, as well as the beliefs and
assumptions of management. Forward-looking statements are subject
to a number of risks and uncertainties, many of which involve
factors or circumstances that are beyond each of BioPharmX's and
Timber's control, and actual results could differ materially from
those stated or implied in forward-looking statements due to a
number of factors, including but not limited to: (i) risks
associated with BioPharmX's ability to obtain the stockholder
approval required to consummate the proposed merger transaction and
the timing of the closing of the proposed merger transaction,
including the risks that a condition to closing would not be
satisfied within the expected timeframe or at all or that the
closing of the proposed merger transaction will not occur; (ii) the
outcome of any legal proceedings that may be instituted against the
parties and others related to the merger agreement; (iii) the
occurrence of any event, change or other circumstance or condition
that could give rise to the termination of the merger agreement,
(iv) unanticipated difficulties or expenditures relating to the
proposed merger transaction, the response of business partners and
competitors to the announcement of the proposed merger transaction,
and/or potential difficulties in employee retention as a result of
the announcement and pendency of the proposed merger transaction;
(v) whether the combined business of Timber and BioPharmX will be
successful, and (vi) those risks detailed in BioPharmX's most
recent Annual Report on Form 10-K and subsequent reports filed with
the SEC, as well as other documents that may be filed by BioPharmX
from time to time with the SEC. Accordingly, you should not rely
upon forward-looking statements as predictions of future events.
Neither BioPharmX nor Timber can assure you that the events and
circumstances reflected in the forward-looking statements will be
achieved or occur, and actual results could differ materially from
those projected in the forward-looking statements. The
forward-looking statements made in this communication relate only
to events as of the date on which the statements are made. Except
as required by applicable law or regulation, BioPharmX and Timber
undertake no obligation to update any forward-looking statement to
reflect events or circumstances after the date on which the
statement is made or to reflect the occurrence of unanticipated
events.
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SOURCE BioPharmX Corporation