ValiRx acquires IP of failed firm FIT Biotech, forms joint venture

Clinical stage biotechnology company ValiRx announced the acquisition of the global granted patents and intellectual property assets of FIT Biotech for a nominal sum on Thursday.

The AIM-traded firm also confirmed it had reached a letter of intent agreement with Alpha Blue Ocean (ABO) to establish a genetic therapeutic and diagnostic-based joint venture founded on the acquired technology.

It described ABO as a management company closely affiliated with European High Growth Opportunities (EHGO), which is is an entity with which ValiRx entered into a subscription agreement, as announced on 26 April.

On the intellectual property purchase, ValiRx said it had entered into a purchase agreement to acquire the assets from the appointed administrator of the bankruptcy estate of FIT Bio for a consideration of €5,000.

FIT Bio was a biotech company based in Tampere, Finland, which was established in 1995, and was publicly listed on the First North Finland marketplace.

It was involved in the development of gene delivery technology for a number of indications, positioning its technology as an alternative to biologics, such as vaccines, antibodies and protein-based drugs.

FIT Bio's principle technology - its ‘Gene Transport Unit’ platform - had seen an initial product enter into clinical trials, ValiRx explained.

ABO had previously provided finance to FIT Bio, having entered into a financing agreement with the firm in December 2017.

Following the termination of that financing agreement, FIT Bio was placed into bankruptcy proceedings.

ValiRx confirmed it had acquired the IP assets from the appointed administrator of FIT Bio.

In conjunction with the acquisition of FIT Bio's intellectual property assets, ValiRx signed a letter of intent with ABO, to establish a genetic therapeutic and diagnostic-based joint venture for the further development of the IP assets, with the objective to assemble and progress a portfolio of genetic-based technologies.

ValiRx said it envisaged that it would provide the scientific, technological and clinical development expertise to the joint venture, while ABO would focus on financing the entity and progressing commercial activities.

It was also envisaged that ValiRx would add its ‘GeneICE’ technology, along with its gene silencing compound ‘VAL101’, into the joint venture’s portfolio to sit alongside the IP assets of FIT Bio

The board said it believed the portfolio technologies were “complementary” to each other.

It explained that the combined portfolio was “well-positioned” to address the large medical and scientific needs for future precision genetic editing, with the anticipated technologies in the joint venture being applicable to a number of indications in oncology, inflammation, infectious diseases and neurological conditions.

The formation of the joint venture remained subject to further due diligence following the conclusion of scientific and financial analysis.

ValiRx and ABO had agreed that discussions and future negotiation were to be conducted on an exclusive basis.

“The area of genetic editing is a very topical subject area at the moment in the media as gene editing looks set to transform the way we battle a range of diseases,” said ValiRx chief executive officer Dr Satu Vainikka.

“The IP assets of FIT Biotech complement well ValiRx's existing gene-based technologies and their combination will assist the group in leveraging its position within this medical marketplace.”