Frequency Therapeutics (NASDAQ:FREQ) shares are up a massive 63% at the time of writing today after the biotechnology company agreed to merge with Korro Bio in an all-stock deal. The latter is an RNA editing company with a focus on novel genetic medicines.
The combined entity is expected to trade on Nasdaq under the ticker ‘KRRO’ and will focus on advancing Korro’s RNA editing programs. Further, Korro has lined up financing commitments of $117 million. The financing is anticipated to close before the closing of the merger, giving the combined entity dry powder of nearly $170 million. This is expected to translate into a cash runway well into 2026.
The combined entity will focus on advancing Korro’s lead program in AATD (alpha-1 antitrypsin deficiency) towards clinical trials and an envisaged regulatory filing in the second half of 2024. The transaction is anticipated to close in the fourth quarter of this year and current investors of FREQ are expected to own roughly 8% of the combined entity.
Meanwhile, FREQ has discontinued its remyelination program for Multiple Sclerosis and is looking at strategic alternatives for the program.
Today’s mega price gains come after a nearly 90% price erosion in Frequency Therapeutics shares so far this year.
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