Don’t count on the triumphant return of biotech special purpose acquisition company deals quite yet. Despite Wilbur Ross’ own blank check company making one of the first announcements for the sector this year, it turns out that deal has now died.
As set out back in January, Aprinoia Therapeutics—a Massachusetts-based biotech focused on neurodegenerative diseases such as Alzheimer’s and progressive supranuclear palsy (PSP)—was due to combine with the SPAC Ross Acquisition at an implied fully diluted transaction equity value of $280 million. At the time, the deal was expected to complete in the first quarter of the year.
Now, five months after that deadline, Aprinoia instead announced yesterday afternoon that the two parties had agreed to a “mutual termination” of the deal. No reasons were given for the decision nor the delays to the merger timeline.
Ross—who served as U.S. secretary of commerce in the Trump administration—had already personally invested $7.5 million through a convertible note, according to the original announcement, with another $12.5 million due to follow if the merger had completed. The plan was for the newly listed Aprinoia to use these funds to bring its lead product, a positron emission tomography imaging tracer for neurodegenerative diseases, through to commercialization in China.
With that funding no longer on the table, it’s unclear how Aprinoia plans to progress any of its imaging agents or an ongoing U.S. phase 1 trial of its lead therapy, a monoclonal anti-tau IgG antibody being investigated for Alzheimer’s, PSP and frontotemporal dementia. The most recent funding infusion for the company was a $40 million series C back in 2021.
With Aprinoia having made no other announcements since unveiling the SPAC deal, it’s hard to get a sense of the other facts in play. The biotech hadn’t responded to a request from Fierce Biotech for further information at the time of publication.
While SPAC deals were a hot ticket for biotechs to go public a couple of years ago, the rush cooled in 2022 as the industry hit tough times. Since then, their use has been more sporadic, although 2023 has seen a steady trickle of merger announcements, with August alone seeing U.K. cell therapy developer Celixir and American Gene Technologies’ HIV-focused unit Addimmune unveiling plans to combine with so-called blank check companies.
It’s not unheard of for SPAC deals to fall through. Last year saw both gene therapy developer Amicus Therapeutics and fibrosis-focused Blade Therapeutics admit their blank check routes had hit a dead end.