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Synthetic Antibody Company Goes Public in $230M Merger

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(Mohamed Hassan, Pixabay. https://pixabay.com/photos/paper-business-finance-document-3213924/)

4 Oct. 2021. A developer of synthetic antibodies for inflammatory and skin disorders is becoming a public company through a special purpose acquisition-merger. The merger with Helix Acquisition Corp., a special purpose acquisition company, or SPAC, is expected to bring MoonLake Immunotherapeutics AG shareholders $230 million, and list the company’s stock on the Nasdaq exchange under the ticker symbol MLTX.

MoonLake Immunotherapeutics in Zug, Switzerland is a biotechnology enterprise creating synthetic antibody fragments that act in the body much like natural antibodies. The company’s technology designs engineered antibodies with lighter and simpler chemical properties resembling those found in camelid mammals, such as camels and llamas. MoonLake says its synthetic antibodies are not only lower in molecular weight than natural antibody proteins, but also more stable in higher temperatures and easier to manufacture.

The company’s lead product is sonelokimab, a synthetic antibody targeting human interleukin or IL-17A and 17F cytokine proteins responsible for the inflammatory skin condition psoriasis and psoriatic arthritis affecting joints. Both disorders are a result of malfunctioning immune systems. Psoriasis develops as scales or plaques on the skin causing red, itchy patches on some 7.5 million adults in the U.S., or about three percent of the population, according to National Psoriasis Foundation. Psoriatic arthritis causes stiffness, tenderness, swelling, and pain in finger joints, affecting some 30 percent of people with psoriasis. MoonLake says sonelokimab is designed to bind with the blood protein albumin to help penetrate joints.

MoonLake formed earlier this year

Results of a mid-stage clinical trial testing sonelokimab reported in the journal The Lancet earlier this year show sonelokimab cleared psoriasis patients of their skin inflammation after 24 weeks in 57 percent of moderate to severe cases, in doses of 120 milligrams. About half of sonelokimab recipients reported mild to moderate adverse effects, the most common being Candida fungal infections, similar to recipients of the currently approved psoriasis treatment secukinumab.

MoonLake Immunotherapeutics was formed in May of this year, and acquired sonelokimab through a licensing deal with drug maker Merck, the drug’s developer at the time. Helix Acquisition Corp. formed in Boston in October 2020, raising $115 million in its initial public stock offering.

In the merger with MoonLake, Helix Acquisition is using the $115 million in cash raised in its IPO with another $115 million raised at $10.00 per share by Comorant Asset Management, a Boston-based hedge fund through a private investment in public equity or PIPE transaction, leading a consortium of nine other private equity investors. Comorant Asset Management is Helix Acquisition’s main financier, and provides Helix’s executives.

MoonLake says it expects to use proceeds from the merger for accelerating development of sonelokimab, particularly for conditions beyond psoriasis, including psoriatic arthritis, ankylosing spondylitis or radiographic axial spondyloarthritis, and hidradenitis suppurativa.

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