17 Mar Here’s What You Should Know about Acer Therapeutics, Inc!
There is a lot of buzz around Acer Therapeutics (NASDAQ: ACER) resulting in the stock zooming skywards. The sudden interest in the company is based on rumors that the Company is likely to be acquired by Relief Therapeutics (OTCQB: RLFTF), a biopharmaceutical company whose lead candidate RLF-100 (aviptadil), a synthetic human vasoactive intestinal peptide (VIP), is currently being evaluated in 2b/3 clinical trials in respiratory deficiency due to COVID-19. We take a look at the events leading to the acquisition and what it entails below:
Exclusive Collaboration and Licensing Agreement with Relief Therapeutics
In January 2021, Acer announced an options agreement with Relief Therapeutics, in exchange for $1 million and an additional $4 Million secured loan, for exclusive rights to negotiate ACER-001 collaboration and license agreement through June 30, 2021. The terms of the proposed collaboration state that ACER will receive $14 million in cash upon completion, and the net $10 million will be offset by repayment of $4 million loan to Relief. The Company will also receive up to $20 million as development and commercialization costs for launch costs of UCDs and MSUD indications in the U.S. Acer will retain the rights in U.S, Canada, Brazil, Turkey and Japan, however it will split profits from its territories in the ratio of 60:40, in favor of relief.
Relief will also license the rights for the rest of the world and will pay ACER 15% net sales royalty on all revenues for its territories, in addition to paying up to $6 million for UCDs and MSUD approvals in the EU.
The rumors of the acquisition stem out of two recent transactions by Relief Therapeutics. The Company recently completed a CHF 10 million private placement (approximately $10.7 million) through a single healthcare-dedicated U.S. institutional investor, in exchange for 41,459,370 of Relief common stock at a purchase price of CHF 0.2412 per share. The proceeds of these transactions are intended to be used to expand its drug pipeline and acquire additional assets as per a Company statement.
Furthermore, the Company has also increased its share capital from 3,246,727,248 to 3,371,727,248 shares through the issuance of 125,000,000 shares at an issue price of CHF 0.01, which will be fully subscribed for by the Company’s wholly owned subsidiary, and will be listed on the SIX Swiss Exchange, fueling rumors of an expected acquisition.
Acer Therapeutics (NASDAQ: ACER)
Market Cap: $51.52M; Current Share Price: 3.60 USD
Data by YCharts
Acer is focused on developing innovative therapeutics for life-threatening conditions and currently has four programs under development, namely ACER-001 (sodium phenylbutyrate) intended for the treatment of urea cycle disorders (UCDs) and Maple Syrup Urine Disease (MSUD); EDSIVO™ (celiprolol) for the treatment of vascular Ehlers-Danlos syndrome (vEDS); ACER-801 (osanetant) for the treatment of induced Vasomotor Symptoms (iVMS) and ACER-2820 (emetine) that targets infectious disease including COVID-19. The Company’s programs are being developed in partnership with NIH: National Center for Advancing Translational Sciences (NCATS), Baylor College of Medicine and Assistance Publique, Hopitaux de Paris.
The Company’s lead candidate ACER-001, a powder formulation of sodium phenylbutyrate (NaPB) addressess the challenges posed by patient compliance to conventional drugs as it offers taste-masking and immediate release. The drug has been granted an Orphan Drug Designation by the FDA for Maple Syrup Urine Disease (MSUD). In February 2020, the Company released data from a clinical trial that compared the bioavailability and bioequivalence of ACER-001 to BUPHENYL® (NaPB). The data shows that ACER-001 to have similar pharmacokinetic (PK) profiles for both phenylbutyrate (PBA) and phenylacetate (PAA) compared to BUPHENYL® under fasted conditions.
Acer is planning a pre-NDA meeting in Q2,2021 and intends to submit the NDA under the Section 505(b)(2) regulatory pathway in mid-2021 for UCD, after including the results from a BE study requested by the FDA as part of its regulatory path forward guidance to the Company in August 2020.
In addition, the candidate is also being evaluated for treatment of Maple Syrup Urine Disease (MSUD). Investigators at the Baylor College of Medicine have found that administration of NaPB reduced BCAA and BCKA and most importantly reduced leucine, the most toxic of the BCAAs. The Company intends to initiate clinical trials to evaluate ACER-001 in MSUD in late-2021, subject to additional capital.
A Growing Industry
Urea Cycle Disorders (UCD) affects the body’s ability to breakdown protein into amino acids, which are essential for growth and tissue repair. Amino acids are converted into nitrogen, and are removed from the body through urine, completing the urea cycle. The liver produces enzymes that help in processing nitrogen to urea, but in some cases the liver cannot produce the specific enzyme, which results in ammonia, a toxic substance building up in the system, which if left untreated, can result in brain damage, coma or even death.
UCD’s are named based on the missing enzyme and can be classified as OTC (ornithine transcarbamylase), ASD (argininosuccinic acid synthetase (citrullinemia), AG (arginase), ALD (argininosuccinase acid lyase (argininosuccinic aciduria), CPS (carbamoyl phosphate synthetase) and NAGS (N-acetylglutamate synthetase). It is a genetic disease that affects one in 30,000 – 35,000 newborns and usually manifests in the form of sleepiness, irritability, mental confusion, hyperactive behavior, feeding problems, vomiting and in severe cases seizures, breathing difficulties and coma.
The disease is diagnosed through urine and blood samples and may even require a liver biopsy or MRI and CT Scan to make a final diagnosis. Currently there is no cure for the condition, but the symptoms can be managed through a low-protein diet, medication, supplements and liver transplantation. According to a report by Delve Insight, there were 20,082 UCD cases in 7MM, out of which the US recorded 6377 cases of late disease onset cases in 2017. The market for UCD therapeutics was valued at USD 788.55 million in 2017 and is likely to grow further owing to increased research and development efforts, rising awareness and better diagnosis.
A Promising Pipeline
Acer’s pipeline also consists of EDSIVO™ for the treatment of Vascular Ehlers-Danlos Syndrome (vEDS). The Company had filed an NDA in October 2018, which was accepted by the FDA, however Acer received a Complete Response Letter (CRL) in June 2019, which called for an adequate and well-controlled trial to determine whether celiprolol reduces the risk of clinical events in patients with vEDS. In February 2021, ACER requested for a meeting with the FDA to discuss its plan to submit sufficient confirmatory evidence.
The Company is planning to submit the IND for Osanetant, a selective, non-peptide tachykinin NK3 receptor antagonist intended for the treatment of hot flashes, flushing, and night sweats, also known as Vasomotor symptoms (VMS), that occur in women entering or in menopause. The IND is likely to be initiated in Q3,2021 and the Company also intends to initiate a phase 2 clinical trial in Q4,2020 based on IND clearance by the FDA. The worldwide rights to the candidate were acquired from Sanofi (NASDAQ: SNY) in December 2018.
Acer has entered into a research collaboration agreement with the National Center for Advancing Translational Sciences, or NCATS to develop Emetine as a treatment option for SARS-CoV-2 infection. The Company will develop the candidate, subject to its ability to raise non-dilutive capital and acceptance of its IND submission by the FDA, post which ACER will initiate a Phase 2/3 COVID-19 clinical trial.
Fourth Quarter Results and Highlights
The Company ended its Q4,2020 with cash and cash equivalents of $5.8 million as of 31 December 2020, compared to $12.1 million as of December 31, 2019. Acer also raised over $3.2 million of net loan received from Relief Therapeutics proceeds through sale of stock under an ATM facility and an equity line purchase agreement with Lincoln Park Capital, and an additional $1 million nonrefundable payment and $4 million secured loan from Relief Therapeutics, received for signing the ACER-001 Option Agreement. The Company believes that these funds are sufficient to fund its operations into Q3,2021.
Disclosure: I/we have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.
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