Medical device firm Apollo Endosurgery and therapeutic antibodies developer Lpath have signed a definitive merger agreement.
The new combined medical device company will develop and commercialize minimally-invasive interventional treatments for obesity.
Under the deal, Apollo security holders will own around 95.8% stake in the combined company, while Lpath security holders will own the remaining 4.2% interest.
As per terms of the merger, Apollo’s major investors will invest around $29m of new equity in the combined firm. The investors comprise of PTV Healthcare Capital, H.I.G. BioHealth Partners, Remeditex Ventures, Novo A/S and CPMG.
In addition, the deal includes certain termination rights for both companies.
Subject to customary closing conditions, including approval by the stockholders of both companies, the deal is expected to complete in the fourth quarter of this year.
Apollo Endosurgery CEO Todd Newton said: “Executing this transaction with Lpath is an expedient way to introduce our company to the public market.
“With the additional equity support we will receive from Apollo’s major investors as part of this transaction, we will have the resources to meet our near-term business needs.”
Lpath CEO Gary Atkinson said: “Following an extensive and thorough review of strategic alternatives, we have chosen to merge with Apollo because we believe the transaction provides Lpath stockholders with an attractive opportunity for value appreciation.”
Apollo Endosurgery is involved in the development of device-based therapies for the treatment of obesity. It markets the products in around 80 countries across the globe.
Lpath is engaged in the discovery and development of therapeutic antibodies, which bind and inhibit bioactive lipids that lead to disease.
Last year, the firm completed the mid-stage clinical development of drug candidates, including iSONEP (sphingomab) in wet age-related macular degeneration and ASONEP (anti-S1P antibody for systemic delivery) in renal cell carcinoma.