Nuformix plc (LON:NFX), a pharmaceutical development company targeting unmet medical needs in fibrosis and oncology via drug repurposing, has announced that it has signed heads of terms with Biovara Limited in relation to the proposed acquisition of the entire issued and to be issued share capital of Biovara by Nuformix through a share-for-share exchange.
Biovara is a privately owned UK pharmaceutical development company focused on developing novel treatments for respiratory conditions. Its lead asset, LipAprep, is a proprietary, patent-protected formulation of aprepitant being developed for the treatment of lung cancer-related cough, a debilitating condition for which there are currently limited effective treatment options. LipAprep has completed Phase 1 single dose clinical development and is being prepared for further clinical studies.
The Proposed Acquisition would combine Biovara’s LipAprep programme with Nuformix’s NXP002 programme for idiopathic pulmonary fibrosis (“IPF”) and other fibrotic interstitial lung diseases. The combination would create a differentiated clinical-stage respiratory drug development company with two proprietary assets targeting significant unmet medical needs, complementary clinical and scientific expertise, and potentially overlapping commercial and licensing opportunities. Both programmes utilise novel, proprietary formulations of established pharmaceutical compounds, with the aim of improving their therapeutic potential in new indications while benefiting from the established clinical and safety experience with the underlying drugs.
The Board of Nuformix believes that the Proposed Acquisition represents an opportunity to create a more substantial and diversified respiratory-focused pharmaceutical development business, with the potential to generate significant shareholder value through the progression of both assets towards important clinical and regulatory milestones, and the pursuit of commercial licensing and development partnerships.
Highlights of the Proposed Acquisition
- The Proposed Acquisition is envisaged as a merger of equals, bringing together Nuformix and Biovara through a share-for-share exchange, with the objective of creating a more substantial and diversified respiratory-focused pharmaceutical development business and unlocking additional value for Nuformix and Biovara shareholders.
- The combination would create a differentiated clinical-stage respiratory drug development company with two complementary assets targeting significant unmet medical needs:
- NXP002: Nuformix’s proprietary inhaled formulation of tranilast for IPF and other fibrotic interstitial lung diseases, supported by encouraging preclinical data and Orphan Drug Designation in the US and Europe.
- LipAprep: Biovara’s proprietary lipid-based formulation of aprepitant for lung cancer-related cough, which has completed Phase 1 single dose clinical development and is being advanced towards a Phase 2 proof-of-concept study.
- Both development programmes utilise novel, proprietary formulations of established pharmaceutical compounds, with the objective of improving their therapeutic potential in new indications.
- The combination would bring together complementary scientific, clinical development and commercial expertise, providing a broader development pipeline, diversification of development risk and opportunities for operational efficiencies.
- The enlarged group would focus on progressing both programmes towards important clinical and regulatory milestones, alongside the pursuit of licensing and commercial development partnerships, with the objective of generating significant shareholder value. The Board sees significant potential overlap between the respiratory pharmaceutical companies interested in NXP002 and those active in lung cancer-related cough, offering opportunities to leverage existing business development relationships across both programmes.
- Nuformix’s previously announced discussions with potential commercial and licensing partners remain ongoing and will continue in parallel with the Proposed Acquisition, which is not expected to delay or adversely affect these activities.
- The Proposed Acquisition would be accompanied by the proposed cancellation of Nuformix’s existing Main Market listing and admission of the enlarged group’s ordinary shares to trading on AIM, subject to the necessary shareholder and other approvals.
Strategic Rationale
The Proposed Acquisition is envisaged as a merger of equals, bringing together two commercially and scientifically complementary programmes, addressing distinct but related areas of respiratory medicine, to create a more substantial and diversified respiratory-focused pharmaceutical development company. The Board believes that the combination offers the potential to unlock additional value for Nuformix shareholders by progressing proprietary products through clinically and commercially meaningful milestones, while diversifying development risk.
NXP002 and LipAprep share a common development strategy, utilising established active pharmaceutical ingredients in novel, proprietary formulations designed to improve their therapeutic potential in new indications.
The Board believes that combining the two businesses would offer a number of strategic benefits, including a broader development pipeline, diversification of clinical development risk, access to complementary scientific and commercial expertise, and potential operational efficiencies. The combination is also expected to create a more compelling proposition for investors and potential commercial partners.
The enlarged group would focus on progressing both assets through clearly defined clinical and regulatory milestones, alongside the pursuit of licensing and commercial development partnerships. The Board believes there is substantial overlap between pharmaceutical companies with interests in fibrotic lung disease and those evaluating treatments for serious respiratory symptoms, including lung cancer-related cough. The enlarged group could therefore present two distinct development and licensing propositions to a substantially overlapping audience, while also accessing expertise and relationships brought by Biovara.
Importantly, the Proposed Acquisition does not alter Nuformix’s existing strategy of seeking commercial partnerships for NXP002. As previously announced, discussions with potential licensing and development partners remain ongoing, and the Company continues to pursue these opportunities in parallel with the Proposed Acquisition. The Board does not anticipate that the Proposed Acquisition will delay or otherwise adversely affect the progress of these discussions or the Company’s ongoing business development activities.
Overview of Biovara and LipAprep
Biovara is a UK pharmaceutical development company focused on novel treatments for respiratory conditions. Its lead asset, LipAprep, is being developed for the treatment of lung cancer-related cough, a condition for which there are currently limited effective treatment options.
Persistent coughing is a common and potentially debilitating symptom in patients with lung cancer, adversely affecting quality of life and contributing to pain, fatigue, sleep disturbance and other complications. There remains a significant unmet need for effective and well-tolerated treatments.
LipAprep is a novel, proprietary, patent protected, lipid-based formulation of aprepitant, an established neurokinin-1 (“NK-1”) receptor antagonist currently used in the prevention of chemotherapy-induced nausea and vomiting.
Aprepitant has demonstrated clinical potential in the treatment of lung cancer-related cough. In a randomised, double-blind, placebo-controlled clinical study, short-term treatment with aprepitant was associated with a mean reduction of 30.3% in 24-hour cough frequency compared with placebo. The study also reported improvements in patient-reported cough outcomes. A separate randomised study involving 128 patients, using seven days of aprepitant in addition to usual antitussive treatment, reported improvements in cough severity and cough-specific quality of life compared with usual treatment alone.
However, the existing formulation of aprepitant has limitations for long-term treatment, including its pharmacokinetic characteristics. LipAprep has been developed to address these limitations through a proprietary lipid formulation designed to provide more predictable drug exposure and support chronic administration.
LipAprep has successfully completed a single ascending dose Phase 1 clinical study, including evaluation at doses of up to 750 mg, and Biovara is progressing preparations for further clinical development, including multiple dosing/dose optimisation and Phase 2 proof-of-concept in patients with lung cancer-related cough.
The LipAprep formulation benefits from patent protection extending to at least 2045.
NXP002
Nuformix’s lead development asset, NXP002, is a proprietary inhaled formulation of tranilast being developed for the treatment of IPF, progressive pulmonary fibrosis and other fibrotic interstitial lung diseases. These are serious conditions characterised by progressive lung scarring and functional decline, for which substantial unmet medical need remains despite existing treatment options.
Nuformix is developing NXP002 to deliver tranilast directly to the lungs, potentially achieving pharmacologically relevant local concentrations while limiting systemic exposure. Preclinical studies have demonstrated anti-fibrotic and anti-inflammatory activity in human IPF lung tissue, including effects on multiple fibrosis-related pathways. More recent inhaled studies have linked pulmonary exposure to modulation of the TGF-β/SMAD signalling pathway and downstream fibrosis-relevant biology in vivo.
Importantly, the underlying oral drug, tranilast, has an extensive human clinical history and a published evidence base across fibrotic conditions, including clinical findings consistent with fibrosis resolution and restoration of tissue function. Nuformix believes that a differentiated inhaled product could help translate this pharmacology into a treatment option for fibrotic lung disease, while addressing limitations of chronic oral administration.
NXP002 has received Orphan Drug Designation in IPF from both the US Food and Drug Administration and the European Medicines Agency.
The Proposed Acquisition would provide an opportunity to advance NXP002 as part of a broader respiratory-focused development portfolio alongside LipAprep. Importantly, Nuformix continues to pursue its existing strategy of securing a commercial development or licensing partnership for NXP002, with previously announced discussions with potential partners remaining ongoing independently of the Proposed Acquisition.
Principal Terms of the Proposed Acquisition
Under the Heads of Terms, Nuformix proposes to acquire the entire issued and to be issued share capital of Biovara in consideration for the issue of new ordinary shares in Nuformix. The Proposed Acquisition is envisaged as a merger of equals, with the combined valuation of the enlarged group to be agreed, reflecting the complementary nature of the two businesses and their respective development assets.
As part of the Proposed Acquisition, it is intended that Nuformix would seek cancellation of the listing of its ordinary shares on the Equity Shares (Transition) category of the Official List and cancellation of its trading on the Main Market of the London Stock Exchange. The enlarged group would seek admission of its ordinary shares to trading on AIM (“Admission”). The proposed move to AIM is intended to provide a market more closely aligned with the enlarged group’s stage of development and growth strategy.
The Proposed Acquisition may constitute a reverse takeover for the purposes of the UK Listing Rules, in which case, Nuformix would not be eligible for re-admission to the equity shares (transition) category of the Official List on completion. Consequently, in circumstances where the Admission of the enlarged group to AIM did not proceed, the Company would be required to publish a prospectus approved by the FCA to remain listed on the Main Market.
The final terms of the Proposed Acquisition remain subject to various conditions, including, inter alia, satisfactory due diligence, further negotiation and the execution of definitive transaction documentation. The parties will undertake reciprocal legal, financial, commercial, technical, intellectual property, clinical and regulatory due diligence as part of this process.
The Heads of Terms provide for an exclusivity period of six months and a transaction long-stop date of 30 April 2027. The Heads of Terms are principally non-binding, other than certain provisions relating to confidentiality, exclusivity, costs, termination and other customary matters.
Conditions and Next Steps
The Proposed Acquisition remains subject, inter alia, to satisfactory reciprocal due diligence, the negotiation and execution of definitive transaction documentation and receipt of all necessary regulatory and shareholder approvals.
Completion would also be conditional on the cancellation of Nuformix’s existing Main Market listing, publication of an AIM admission document and admission of the enlarged group’s ordinary shares to trading on AIM.
The Proposed Acquisition will require certain resolutions to be approved by Nuformix shareholders at a general meeting, including the necessary authorities to issue new ordinary shares in connection with the transaction. The transaction is also likely to require the Takeover Panel to grant a waiver of the obligation to make a mandatory offer under Rule 9 of the City Code on Takeovers and Mergers, which would also be subject to approval by independent Nuformix shareholders.
There can be no certainty that the Proposed Acquisition will proceed or as to its final terms. The parties intend to progress the Proposed Acquisition as quickly as practicable, and further announcements will be made in due course as appropriate.
Appointment of SP Angel
Nuformix is pleased to announce the appointment of SP Angel Corporate Finance LLP (“SP Angel”) as its financial adviser in connection with the Proposed Acquisition and the proposed Admission. It is intended that SP Angel will act as nominated adviser and joint broker to the enlarged group following Admission, subject to completion of the necessary due diligence and regulatory requirements.
Commenting, Tim Metcalfe, Chairman of Nuformix, said:
“We believe the proposed acquisition of Biovara represents an important strategic opportunity for Nuformix and its shareholders, bringing together two complementary respiratory drug development programmes to create a more substantial and diversified clinical-stage respiratory business with the potential to unlock significant shareholder value.
“This is not diversification for its own sake. We see clear alignment between the programmes, the capabilities needed to advance them and the pharmaceutical partners most likely to be interested in their potential.
“Bringing NXP002 and LipAprep together would give the enlarged group two distinct clinical development and licensing propositions, each with its own potential milestones, while enabling us to leverage the commercial relationships already established for NXP002. It would broaden the opportunities for value creation without changing our priority of progressing NXP002 and continuing active partnering discussions.
“While there remains considerable work to complete before the Proposed Acquisition can be completed, we are enthusiastic about the opportunities that the combination could create and look forward to updating shareholders as matters progress.”
Commenting, Dr Dan Gooding, Executive Director of Nuformix, said:
“What particularly interests us about LipAprep is the strength of the clinical rationale. In a controlled clinical study, aprepitant reduced 24-hour cough frequency by over 30% versus placebo after just three days at the standard antiemetic dose. For patients who may experience persistent cough over much longer periods, that is a highly encouraging early signal and raises an obvious development question: what might be achievable with a formulation designed to investigate more sustained and potentially optimised exposure?
“We have discussed that opportunity with leading clinicians, including investigators involved in the earlier aprepitant research, and their feedback has reinforced the rationale for further clinical investigation. LipAprep’s completed single-dose Phase 1 work creates a starting point for addressing that question in an appropriately designed clinical programme.
“Equally, NXP002 remains a highly differentiated opportunity, with encouraging results in human IPF lung tissue, recent in-vivo evidence of fibrosis-relevant pathway engagement and a substantial historical clinical evidence base for tranilast, including findings consistent with fibrosis resolution and restoration of tissue function.
“Through our NXP002 work we have spent considerable effort building relationships across the international respiratory pharmaceutical sector. The potential to bring two programmes, rather than one, to an overlapping group of prospective partners is commercially attractive. We believe this could make the enlarged group a more interesting development and partnering proposition while creating multiple opportunities to advance assets and generate value.”
