Viscient Biosciences Will Bioprint 3D Lung Tissue to Aid Pandemic Research, and Viscient Founder Calls for Pause in Organovo ...
March 31 2020 - 2:25PM
Keith Murphy, founder and Chief Executive Officer of Viscient
Biosciences (“Viscient”), today is calling for a pause in the
merger attempt of Organovo Holdings, Inc (“Organovo”), after
Organovo failed to receive enough votes to consummate the merger.
Mr. Murphy also founded Organovo, was its former CEO and Chairman
Emeritus, and has opposed the merger as a 1% stockholder of
Organovo. Given the conditions of global pandemic and the
opportunity for 3D bioprinting technology to assist in finding
cures for COVID-19, Mr. Murphy is reaching out with a call to his
former Board peers for a pause in the merger conflict.
Viscient is a biotherapeutics company focused on
using 3D bioprinting technology to displace the use of animal
models in pharma research and provide more accurate models of human
disease. Viscient foresees a world where drug costs can be
reduced due to more accurate disease modeling which can accelerate
drug discovery and preclinical research. Viscient achieved a
breakthrough in December: finding the world’s first drug targets
discovered using 3D bioprinted disease models. Viscient has
validated several such targets using its proprietary liver fibrosis
tissue that replicates non-alcoholic steatohepatitis (NASH, a
serious form of fatty liver disease).
Mr. Murphy said, “When you can remove diseased
cells from the human body and reproduce that disease in a dish, you
can see the true biology and quickly find a therapy that will work
in clinical trials. Drugs found in animal models so often
fail because of the species gap, but as we proved with our NASH
liver work, important novel drug targets can be found using 3D
bioprinting technology. We now are moving quickly to apply the same
technology to create 3D human lung tissue to test potential
COVID-19 therapies to accelerate development.”
Viscient, or a sister company to be funded and
launched shortly using the same technology, will now use 3D
bioprinting technology to create lung tissue to support viral
infectivity research and search for an effective therapy against
SARS-CoV-2, the novel coronavirus which causes COVID-19. Using the
paradigm developed for liver as well as previous work in lung
tissue, 3D bioprinted and other 3D tissue models made with lung
cells, including a patient’s own cells, are expected to be
used as a “clinical trial in a dish,” helping test potential
COVID-19 therapies quickly and with highly accurate biology.
Previous research has already shown that 3D human lung tissue
better models viral infectivity compared to regular cell
culture.
Regarding the merger of Organovo and Tarveda
Biosciences (“Tarveda”), it is Mr. Murphy’s strong opinion that
Organovo’s notifications regarding the special meeting of
stockholders failed to follow SEC guidance and that this failure
calls into question the validity of the adjournment.1 Organovo
changed the location of the meeting without proper notice to
stockholders, causing documented stockholder confusion that is
likely to have resulted in stockholders missing the opportunity to
vote. However, in the midst of a global crisis, Mr. Murphy proposes
that rather than clash over these matters at this time, both sides
pause in the process and resume these matters later.
“It’s in no one’s interest to get into a legal
battle at this time given the global pandemic we all are facing,”
said Mr. Murphy, “Viscient has an opportunity to help speed
potential therapies for the novel coronavirus to market. I’m
calling on the Organovo Board to do the right thing and agree to
cease activity and table these matters in light of the
circumstances. With so many stockholders not voting in support of
this merger and likely to consider the adjournment invalid, the
Board should also now see this as the right thing for the
investors.”
Organovo is in a particularly good position to
press pause, as it has already ceased major operations. With
capital markets in turmoil, it also seems like a poor time to
launch a new public company via this type of merger. Tarveda, the
merger company, intends to develop cancer compounds and launch
additional clinical trials, but it would seem impossible to do so
during this novel coronavirus outbreak. Indeed, many pharma
and biotech companies are pausing clinical trials due to healthcare
systems being overwhelmed in the critical fight against
COVID-19.
In August 2019, Organovo announced that its
Board was seeking strategic alternatives. In October 2019, Viscient
Biosciences announced that it had made a merger proposal for
Organovo. In November 2019, Organovo announced that it had reached
a definitive merger agreement with another company, Tarveda. As a
stockholder of Organovo, Mr. Murphy has publicly opposed the
Tarveda merger.
Organovo called a special meeting of
stockholders, to be held on March 26, 2020, to hold a vote on
matters including the approval of measures needed to complete the
merger with Tarveda. Organovo changed the meeting location without
proper notification to stockholders as required by the SEC.
Despite this, Organovo also did not receive sufficient support from
its stockholders to consummate the merger. Organovo purported
to adjourn the meeting until April 7, 2020, to solicit additional
proxies, which is to say, to attempt to receive more votes over
time to support the merger. The vote to adjourn the meeting
was 47.8 million votes for and 46.9 million votes against, close
enough that the failure to properly notify becomes a significant
issue. If the vote to adjourn did not pass, Organovo would
not be able to keep trying to solicit votes in favor of the merger,
and the merger vote would have already fallen short.
Given that Organovo’s insufficient notification
to stockholders renders the adjournment potentially ineffective and
throws its whole process into chaos, the matter is likely to
require legal adjudication and possibly a complete restart of its
proxy voting process. In the light of current world events, out of
consideration for the safety of court personnel, and to respect
both the large number of shareholders voting against and those
whose votes may not have been counted, Mr. Murphy suggests that
rather than attempt to push forward under such circumstances,
Organovo avoid such divisive conflict at this time.
1. The assertion that Organovo changed the
location of the meeting without proper notice is in light of the
fact that SEC guidance explicitly requires companies changing to
virtual stockholder meetings to issue press releases for such
changes, which Organovo did not do.
https://www.sec.gov/ocr/staff-guidance-conducting-annual-meetings-light-covid-19-concerns
About Viscient Biosciences
Viscient Biosciences is a San Diego-based
biotechnology company working at the intersection of human 3D
tissue technology and multi-omics (genomics, transcriptomics,
metabolomics) analysis to discover and develop drugs across a range
of therapeutic areas with significant unmet medical need. By
leveraging our expertise in complex, three-dimensional disease
models comprised of human cells and complex analytical methods, we
are able to drive drug discovery in a previously unavailable
context, leading to a better understanding of disease and an
improved opportunity to impact patients’ lives. Founded by a
combination of former Organovo and Ardea Biosciences scientists and
entrepreneurs, Viscient is initially conducting discovery and
development work in non-alcoholic steatohepatitis (“NASH”). Learn
more at www.viscientbiosciences.com.
Media Contact: Jessica Yingling, Ph.D., Little
Dog Communications Inc., jessica@litldog.com, +1.858.344.8091
SOURCE: Viscient Biosciences
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