What's Going On With Quince Therapeutics Stock Today

Quince Therapeutics Inc QNCX has agreed to acquire EryDel SpA, a privately-held, late-stage biotech company, in a stock-for-stock upfront exchange and potential downstream milestone cash payments. 

EryDel has developed an autologous intracellular drug encapsulation technology and a Phase 3 lead asset, EryDex, targeting a rare fatal pediatric neurological disease, Ataxia-Telangiectasia (A-T).

Upon completion of the transaction, EryDel stockholders will own approximately 16.7% of the combined company and will be entitled to up to $485 million upon achieving development, regulatory, and commercial milestone payments, with no royalties. 

The transaction is expected to close in the third quarter of 2023.

The combined entity will be well-capitalized until 2026 and capable of fully funding EryDex through Phase 3 clinical trials under a Special Protocol Assessment (SPA) and onto New Drug Application (NDA) submission. 

They have a strong balance sheet with approximately $87.6 million in cash, cash equivalents, and short-term investments (unaudited) as of June 30, 2023. 

The potential for licensing territories outside the U.S. could also provide a financial runway through the regulatory approval of EryDex.

The plan is to enroll the first patient in the global Phase 3 trial of EryDex in Q2 2024, targeting an NDA submission by the end of 2025. EryDex has already demonstrated its efficacy and safety profile in a previous Phase 3 clinical trial of A-T patients, with EryDex slowing neurological deterioration in A-T disease progression and demonstrating a well-tolerated safety profile.

The acquisition also offers a potential peak global sales opportunity of over $1 billion for A-T alone. It also promises swift expansion potential for EryDex to other rare and debilitating diseases.

Price Action: QNCX shares are down 24.10% at $1.20 on the last check Monday.