Full Press Release Details
Aditxt Signs a Definitive Agreement to Acquire
Appili Therapeutics Inc., Developer of a Biodefense Vaccine Funded by the U.S. Department of Defense (DoD)
Assets include the FDA-approved LIKMEZ ,
the ATI-1701 tularemia vaccine defense program that has been awarded a USD $14 million non-dilutive award from the DoD, and the ATI-1801
Mountainview, CA., April 2, 2024 - Aditxt, Inc.
("Aditxt" or the "Company") (NASDAQ: ADTX), a company dedicated to discovering, developing, and deploying promising
health innovations, today announced that it has entered into a definitive arrangement agreement ("Arrangement Agreement") to
acquire Appili Therapeutics Inc. (TSX: APLI; OTCQX: APLIF) ("Appili"), a biopharmaceutical company focused on drug development
for infectious diseases and medical countermeasures,. Under the Arrangement Agreement, Aditxt's
wholly owned subsidiary, Adivir, Inc. ("Adivir") agreed to acquire all issued and outstanding Class A common shares of Appili
(the "Appili Shares") through a court-approved plan of arrangement under the Canada Business Corporations Act
Since its inception in 2015, Appili has developed
a diverse portfolio, including the FDA-approved LIKMEZ (previously ATI-1501), ATI-1701 biodefense program supported by a USD $14
million non-dilutive award from the U.S DoD., and ATI-1801, a topical formulation targeting
cutaneous leishmaniasis, a painful and disfiguring disease.
LIKMEZ, FDA-Approved Taste-Masked Oral Suspension
for Bacterial Infections
Appili developed LIKMEZ, a new formulation of
the antibiotic metronidazole, specifically tailored to improve patient experience and adherence, particularly in patients who have difficulty
swallowing large tablets. The patent-protected LIKMEZ is a reformulated taste-masking technology containing metronidazole, which makes
it easier to swallow and better tasting, increasing patient compliance.
FDA's approval of LIKMEZ highlighted Appili's capacity to identify and develop significant opportunities within the infectious disease
domain. Appili licensed the manufacturing and commercialization rights in the U.S. and other selected territories to Saptalis Pharmaceuticals,
LLC ("Saptalis"). Appili, in collaboration with Saptalis, continued the product's development, ultimately achieving FDA approval
in the United States. With
FDA approval, future revenue is expected to be derived from milestone payments and royalties from Saptalis under the license agreement.
Live Attenuated Vaccine for Francisella Tularensis
developing ATI-1701 as a live attenuated vaccine to combat Francisella tularensis, which is classified by the U.S. National Institutes
of Health (NIH) as a Category A pathogen, an organism that poses the highest risk to national security and public health due to its high
rate of infectivity and ability to cause lethal pneumonia and systemic infection. Estimated to be 1,000-fold more infectious than anthrax,
experts consider the aerosolized form to have a high potential for use in a bioterrorism attack.
strategic alignment with governmental and public health priorities has secured non-dilutive funding of USD $14 million from the U.S. DoD
for its ATI-1701 biodefense program. This funding has been crucial in advancing the development of ATI-1701, including support for manufacturing,
non-clinical studies, and regulatory activities through the submission of an Investigational New Drug (IND) application. ATI-1701
may be eligible for a Priority Review Voucher (PRV) if the U.S. Government extends the Medical Countermeasures PRV program. A PRV enables
its recipient to expedite the review process for future drug applications upon issuance. While no assurance can be provided that ATI-1701
will be deemed eligible for a priority review voucher or, what its ultimate worth will be if approved, and recent secondary market transactions
involving PRVs have ranged from USD $80 million to USD $100 million, their strategic value extends beyond the secondary market, offering
significant advantages in accelerating the development timeline of new treatments.
ATI-1801, Topical Formulation for the Treatment
of Cutaneous Leishmaniasis (CL)
ATI-1801 represents Appili's innovative
approach to combating cutaneous leishmaniasis (CL), a devastating skin infection classified by the World Health Organization (WHO) as
a Neglected Tropical Disease (NTD) that impacts hundreds of thousands of individuals globally. This topical product is formulated with
paromomycin, a previously approved antibiotic available in oral or injectable form. The topical formulation allows a more direct and comfortable
application for patients who suffer from painful CL lesions.
Having undergone evaluation in a Phase 3 study,
ATI-1801 targets CL infections that manifest through skin lesions and ulcers, leading to potential scarring, disfigurement, and societal
stigma. Appili is committed to collaborating with stakeholders worldwide to advance the development of ATI-1801 and to obtain regulatory
approvals, ensuring global access to this critical treatment. Additionally, Appili is assessing the potential for ATI-1801 to qualify
for a Priority Review Voucher (PRV), a step that could further expedite bringing this essential therapy to those in need.
Synergy with Aditxt's Programs
This acquisition will enhance Aditxt's portfolio
of subsidiaries and create synergies with its existing programs, particularly precision diagnostics. Integrating Appili's expertise
and product lines would pave the way for a comprehensive approach to population health, from early detection and prevention to treatment.
The potential for collaboration within the Aditxt ecosystem can streamline patient care, from early detection through precision diagnostics
to developing tailored treatment strategies.
Amro Albanna, Co-Founder, Chairman, and CEO of
Aditxt, elaborated on the significance of this acquisition, stating, "The acquisition of Appili would represent another step in
Aditxt's journey towards advancing promising innovations in health. Our mission is to accelerate some of the most promising health
innovations, like those developed by Appili, to reach their full potential and to have a lasting impact. The urgency for innovative and
effective public health solutions is unprecedented. The need to discover and bring new treatments to the market or to enhance existing
ones to combat public health challenges has never been more critical. By integrating Appili's proven expertise and diverse portfolio
in the infectious disease and biodefense domain, Aditxt can substantially contribute to advancing public health solutions."
"This transaction with Aditxt aligns with
our goals on multiple levels. We see this as an opportunity for growth, innovation, and collaboration.
Our shared vision and combined expertise will undoubtedly accelerate our mission to develop innovative treatments and solutions
for some of the most challenging health threats facing the world today. Appili can now leverage Aditxt's proven research and development,
operations, and commercialization expertise to accelerate the development of our three programs. Secondly, as a NASDAQ-listed company,
we believe Aditxt can facilitate capital access in this challenging economic environment. We welcome
this new chapter, confident that together, we will achieve even greater heights in deploying innovative healthcare solutions." said
Dr. Don Cilla, President and CEO of Appili Therapeutics.
Transaction Details:
The Transaction will be effected through a court-approved
plan of arrangement under the Canada Business Corporations Act. Under the terms of the Arrangement Agreement, Adivir will acquire
all of the issued and outstanding Appili Shares, with each Appili Shareholder receiving (i) 0.002745004 of a share of common stock (each
whole share, an "Aditxt Share") of Aditxt (the "Share Consideration") and (ii) US$0.0467 for each
Appili Share held (the "Cash Consideration" and together with the Share Consideration collectively, the "Transaction
Consideration") representing total consideration per Appili Share of approximately US$0.0561 based on the closing price of Aditxt
stock on March 28, 2024 After giving effect to the Transaction, Appili Shareholders will hold approximately 19.99% of the issued and outstanding
Aditxt Shares (on a non-diluted basis) based on the currently issued and outstanding Aditxt Shares (calculated on a non-diluted basis).
In connection with the Transaction, each outstanding option and warrant of Appili will be cashed out based on the implied in-the-money
value of the Transaction Consideration.
In connection with the Transaction Aditxt will:
(i) agree to repay no less than 50% in outstanding senior secured debt at the closing of the Transaction (the "Closing")
and to repay the remaining outstanding senior secured debt by no later than December 31, 2024; (ii) acquire all of Appili's remaining
outstanding liabilities and indebtedness; and (iii) agree to satisfy certain payables of Appili at Closing as further detailed in the
Arrangement Agreement.
The Transaction is subject to the approval of
at least two-thirds of the votes cast at the special meeting of the Appili Shareholders, which is expected to be held before the end of
calendar Q2 2024 to approve the Transaction.
Appili's directors, officers, and certain shareholders
holding approximately 11.9% of the total voting power of the issued and outstanding Appili Shares have entered into voting support agreements
with the Buyer to vote in favor of the Transaction.
The Transaction is conditional upon Aditxt raising
at least US$20 million in financing (the "Aditxt Financing") prior to Closing. In addition, completion of the Transaction
is subject to other customary conditions, including the receipt of all necessary court, regulatory and stock exchange approvals. Subject
to receiving all required approvals, Closing is expected to occur not later than early Q3 2024.
The Arrangement Agreement contains customary terms
and conditions, including non-solicitation provisions, which are subject to Appili's right to consider and accept a superior proposal