Acer Therapeutics, a three-year-old Cambridge biotechnology company that develops drugs for ultra-rare diseases, said Monday that it will be made public through a reverse merger with a small Texas company.
Acer said it would merge with Opexa Therapeutics (Nasdaq: OPXA), which fired all but two of its 20 employees after its leading drug for multiple sclerosis rejected a mid-stage trial in October. Shares of the combined company – which will retain the Acer name and the headquarters of Kendall Square – will be traded under the “ACER” ticker.
In connection with the deal, Acer said it will receive a $ 15.7 million round of financing led by TVM Capital, a German-based life-risk company. TVM and other investors at Acer will own 89 percent of the combined company’s stock, while current Opexa investors will have 11 percent.
The merger has yet to be approved by shareholders but is expected to close in the third quarter of 2017.
An Acer representative declined to say how many employees the company has.
Acer executive director Chris Schelling will lead the combined company. In a statement, he said the funding would allow the company to seek FDA approval for its leading drug, a potential treatment for severe tissue disorder Vascular Ehlers-Danlos syndrome, in the first half of 2018. Currently, there are no treatments Approved for vEDS, which can cause rupture of arteries and organs.
Acer is also developing a drug for a rare genetic disease, called maple syrup urine, or MSUD, in which the body can not metabolize certain amino acids. There are no MSUD approved treatments.
Opexa shares rose 72 percent since midday on Monday.
Monday’s announcement marks the second time in so many months that Cambridge biotech has been made public through a reverse merger with a struggling Texas firm. On May 16, Synlogic, which focuses on drugs that affect bacteria in the gut, announced its combination with Mirna Therapeutics Inc., along with a new $ 42 million investment.