Aduro Biotech and Chinook Therapeutics Announce Definitive Merger Agreement
June 02, 2020 at 07:30 AM EDT
– Combined Company Will Operate as Chinook Therapeutics and Advance Pipeline of Clinical-Stage Programs in Kidney Diseases, Led by Atrasentan and BION-1301 in IgA Nephropathy
– Combined Company Will be Well-Funded With Cash Position of ~$200 Million Expected at Closing, Including $25 Million in Additional Investment Committed by Chinook’s Existing Investors
– Multiple Clinical and Regulatory Pipeline Milestones Planned for Combined Company Over the Next 12-18 Months
– Companies to Host Joint Conference Call on Tuesday, June 2, 2020 at 8:30 am EDT
BERKELEY, Calif., VANCOUVER, British Columbia and SEATTLE, Wash., June 02, 2020 (GLOBE NEWSWIRE) -- Aduro Biotech, Inc. (“Aduro”) (NASDAQ: ADRO) and Chinook Therapeutics, Inc. (“Chinook”), a privately held clinical-stage biotechnology company focused on the discovery, development and commercialization of precision medicines for kidney diseases, today announced that the companies have entered into a definitive merger agreement pursuant to which Aduro will acquire all of the outstanding capital stock of Chinook in exchange for shares of Aduro common stock representing approximately 50 percent of Aduro’s outstanding common stock immediately following completion of the transaction. The combined company is expected to have approximately $200 million in cash, cash equivalents and marketable securities at closing, including $25 million in additional financing committed by Chinook’s existing investors. Following closing, which is expected to occur in the second half of 2020, Aduro will be renamed Chinook Therapeutics, Inc., and is expected to trade on the Nasdaq Global Market under the ticker symbol “KDNY”.
The combined company’s pipeline will include:
The combined company plans to advance its pipeline through multiple clinical trials, including the following milestones anticipated over the next 12-18 months:
Aduro is currently exploring strategic alternatives for its legacy programs outside of kidney disease, including the STING agonist program in collaboration with Novartis, cGAS-STING inhibitor program in collaboration with Lilly, and anti-CD27 program out-licensed to Merck, as well as deprioritized programs such as the anti-SIRPα and anti-CTLA-4 antibodies. Immediately prior to the closing of the proposed merger, Aduro stockholders will be issued contingent value rights representing the right to receive certain cash payments from proceeds received by Aduro, if any, related to its non-renal assets for a period of ten years following closing.
“After an extensive and thorough review of strategic and potentially transformative options for Aduro, we are very pleased to announce a proposed merger with Chinook,” said Stephen T. Isaacs, chairman, president and chief executive officer of Aduro. “We believe the combined company’s strong pipeline, near-term milestones, seasoned leadership team and focus on kidney diseases offer an excellent opportunity to benefit patients and provide value to our stockholders.”
“The proposed merger with Aduro is a unique opportunity for Chinook to build a leading company in the kidney disease space, particularly by pursuing complementary approaches to treating IgA nephropathy with both atrasentan and BION-1301,” said Eric Dobmeier, president and chief executive officer of Chinook Therapeutics. “The combined company will have the demonstrated expertise and strong balance sheet to advance its three lead programs towards multiple anticipated milestones over the next 12 to 18 months. I’m grateful to our existing investors, Versant, Apple Tree and Samsara, for their ongoing support and the additional capital they’ve committed to help build Chinook and advance our pipeline of novel product candidates for rare, severe chronic kidney diseases.”
About the Proposed Merger
Each of Versant Ventures, Apple Tree Partners, Samsara BioCapital, Abbvie, Inc., Morningside Venture (VI) Investments Limited, Morningside Foundation and Ultimate Keen Limited, as well as the directors and certain officers of both companies, representing a total of approximately 85% of the outstanding stock of Chinook and approximately 22% of the outstanding stock of Aduro, have signed support agreements committing to vote in favor of the transaction and lock-up agreements restricting transfers of the combined company’s stock for 180 days post-closing.
The transaction has been unanimously approved by the board of directors of both companies. The combined company will be headquartered out of Chinook’s existing facilities in Vancouver, BC and Seattle, Washington.
SVB Leerink is acting as exclusive financial advisor and Latham & Watkins LLP is serving as legal counsel to Aduro. MTS Health Partners is acting as exclusive financial advisor and Fenwick & West LLP is serving as legal counsel to Chinook.
Management and Organization
Additionally, effective as of the closing of the merger, the board of directors of the combined company will be comprised of seven directors: Eric Dobmeier, president and chief executive officer of Chinook Therapeutics; Jerel Davis, Ph.D., managing director at Versant Ventures; Srini Akkaraju, M.D., Ph.D., managing general partner at Samsara BioCapital; William M. Greenman, president and chief executive officer of Cerus Corporation; and Ross Haghighat, founder, chairman and managing partner of Triton Systems, Inc.; and two additional independent directors.
Conference Call Details
Additionally, Chinook management will present an overview of the company and its pipeline at the Jefferies Virtual Healthcare Conference on Wednesday, June 3, 2020, at 3:30 pm EDT.
To access the live webcasts and subsequent archived recordings of these and other company presentations, please visit the investor section of Aduro's website at www.aduro.com or Chinook’s website at www.chinooktx.com. The archived webcasts will remain available for replay on Aduro’s and Chinook’s websites for 90 days.
About Chinook Therapeutics
Important Information and Where to Find It
Participants in the Solicitation
Cautionary Note on Forward-Looking Statements