Scintilla Pharmaceuticals Inc. has agreed to buy venture capital-backed Semnur Pharmaceuticals Inc. for up to $200 million. Scintilla is a subsidiary of San Diego-based Sorrento Therapeutics Inc. (Nasdaq: SRNE). Financial deal terms call for Scintilla to pay $60 million up front, consisting of $40 million in cash and $20 million in common stock, and up to an additional $140 million in cash based on the target’s future performance.
Los Altos, California-based Semnur develops injectable drugs that are used to potentially treat chronic back pain. The company’s main product is scheduled to begin phase 3 clinical trials in 2017. Semnur is backed by Canaan Partners, Frazier Healthcare and Vivo Capital.
“Semnur's pipeline of multiple late-stage and near commercialization product opportunities targets some of the largest pain markets available and addresses critical unmet medical needs,” says Sorrento CEO Henry Ji. Scintilla also has a pending acquisition for Scilex Pharmaceuticals, another pain management drug developer, for up to $70 million. Scintilla is known for developing potential cancer treatments.
Pharmaceutical companies have been looking to replenish their pipelines through M&A. Nichi-Iko Pharmaceutical Co. agreed to buy Sagent Pharmaceuticals Inc. (Nasdaq: SGNT); Perrigo Co. (NYSE: PRGO) purchased generic forms of Retin-A; and Takeda Pharmaceutical Co. formed a partnership with Teva Pharmaceutical Industries Ltd. to sell generic drugs and certain off-patent medicines in Japan.
Joseph Gunnar & Co. is advising Sorrento.