Vallon Pharmaceuticals and GRI Bio announced a definitive merger agreement in which the two companies will be working together on advancing a pipeline of NKT cell regulators for inflammatory, fibrotic and autoimmune diseases.
Under the terms of the agreement, the two companies will come together in an all stock-transaction and the combined company will operate as “GRI Bio, INC.” New-York based fund management company Altium Capital will invest roughly $15 million in the combined company at the time of the deal and an additional $10 million in future investments.
GRI Bio is a biotech focused on inflammatory disease treatments, specifically Natural Killer T (NKT) cell-based therapies for liver disease. Its lead program, GRI-0621, is an inhibitor of type I NKT cells expected to enter its phase 2a trial. Based in California, GRI Bio is also developing three type II antagonists; GRI-0803 for the treatment of lupus, GRI-0124 for primary sclerosis cholangitis, and GRI-0729 for an undisclosed indication.
Philadelphia-based Vallon Pharmaceuticals had focused on the development and commercialization of novel abuse-deterrent medications for central nervous system disorders. However, earlier this year, its ‘abuse-resistant’ ADHD drug ADAIR failed to meet the primary endpoint in its phase 3 trial. ADAIR, or Abuse Deterrent Amphetamine Immediate Release, an investigational new drug for the treatment of attention deficit hyperactivity disorder, was designed to deter users from crushing or snorting it. But in the study to evaluate abuse liability and 'Drug Liking' results — which can signal the potential for abuse of a drug — ADAIR finished with about the same results as reference dextroamphetamine and therefore did not meet statistical significance.
At the time that the trial results were revealed in March of this year, Vallon shares dropped by almost 70%. But now in an impressive comeback, the biotech’s shares rose by almost 230% to 85 cents after the merger announcement this week.
