, with the closing consideration for theacquisition being non-cash in the form of an issue of 102,321,345 new shares inBenitec Biopharma—this amounts to just under $1.5 million in value.
There is also a potential cash royalty, to be calculatedas follows: 35 percent if the license is entered into prior to commencement ofa Phase II clinical study, 15 percent prior to commencement of a Phase IIIclinical study, 5 percent if prior to the submission of a Biologic LicenseApplication to the U.S. Food and Drug Administration or 2.5 percent if afterBiologic License Application submission.
The privately held Tacere brings to Benitec aPhase I/II-ready program in hepatitis C (HCV) that uses Benitec Biopharma'snovel gene silencing technology called DNA-directed RNA interference (ddRNAi).
The acquisition of Tacere is, according toBenitec, "to be completed on favorable commercial terms reflecting BenitecBiopharma's unique understanding of the assets and original licensing agreementcovering the use of its ddRNAi technology."
Benitec will acquire Tacere's HCV program data andmaterials, as well as an advanced preclinical program for the eye diseasemacular degeneration, which also utilizes Benitec's ddRNAi technology.
The deal is expected to be complete by around theend of October or earlier; the acquisition is subject to standard closingconditions, including execution of certain ancillary agreements.
Benitec reports that the U.S. company's directorof research and development, Dr. David Suhy, will be joining Benitec Biopharmain a newly created role of senior vice president of research and development.
"We are delighted to announce the acquisition ofTacere and its lead compound TT-034 for HCV" said Dr. Peter French, CEO of BenitecBiopharma. "We see the benefits of this transaction as twofold. Tacere has beensuccessfully developing programs utilizing Benitec's proprietary ddRNAitechnology since 2006, and it now makes sense to bring these assets in-house tocomplement and strengthen our pipeline as we move into clinical development.
"We believe the preclinical data and safetyprofile of TT-034 positions the company to commence clinical trials inhepatitis C at a time when a number of high-profile HCV therapies such asnucleotide polymerase inhibitor are encountering safety concerns," he continued."The Tacere program provides us with the opportunity to commence Phase I/IIclinical trials in mid-2013."
TT‐034 is a next-generation therapeuticdesigned to be a "one shot monotherapy cure," intended to clear HCV with a singleinjection, though plans also call for it to be used in combination with existingand new small-molecule drugs. TT‐034 is composed of three short-hairpinRNAs targeting three separate, highly conserved regions on the HCV virus genome,so that it can inhibit HCV resistance development while maintaining target specificity,high efficacy and low off‐target effects. Another sellingpoint of the compounds is that it is mainly targeted to genotype 1, the most prevalentand underserved HCV genotype.