RDD Pharma Enters into Non-Binding Letter of Intent to Acquire Naia Rare Diseases, Strengthening Gastroenterology Orphan Disease Pipeline

TEL AVIV, Israel and RICHMOND, Calif., Nov. 13, 2019 /PRNewswire/ -- RDD Pharma, Ltd. ("RDD"), a company focused on orphan and innovative therapies for gastrointestinal disorders entered into a non-binding letter of intent ("LOI") to acquire Naia Rare Diseases ("Naia"), a biopharmaceutical company developing drugs for Short Bowel Syndrome ("SBS") and other rare gastrointestinal diseases. Closing of the transaction is anticipated to occur after the consummation of the proposed merger of RDD and Innovate Biopharmaceuticals, Inc. (Nasdaq: INNT) which will form a combined company (the "INNT Merger") intended to be named 9 Meters Biopharma, Inc. In exchange, Naia will receive a combination of cash and shares in 9 Meters Biopharma subject to closing of the INNT Merger. Pursuant to the terms of the LOI, the combined company would acquire all of the outstanding capital stock of privately-held Naia.

"Combining the pipelines of RDD, Innovate and Naia Rare Diseases into 9 Meters Biopharma would create a next generation gastroenterology company focused on developing treatments for unmet needs in specialty, rare and orphan indications. From Naia's drug candidates to the first-ever Phase 3 registration trial in celiac disease, we expect multiple value creating inflection points over the next 24 months," said John Temperato, the current CEO of RDD and named CEO of 9 Meters Biopharma. 9 Meters will be poised to realize these inflection points behind a highly seasoned management team especially adept at in-licensing, developing and commercializing multi-billion dollar assets in gastroenterology, along with prominent healthcare-dedicated institutional investors, led by Orbimed Advisors, LLC.

Through the transaction, the combined company will acquire Naia's investigational therapeutic, NB-1001, a long-acting glucagon-like peptide-1 (GLP-1) receptor agonist that combines exenatide with a proprietary extended half-life technology for the treatment of SBS. Long-acting NB-1001 extends the half-life of GLP-1 and allows for up to once-per-month dosing, considerably increasing administration convenience with a potentially improved safety profile versus other GLP-1 agonists secondary to lower overall exposure and dose required. The proposed agreement includes a glucagon-like peptide 2 (GLP-2) analogue with improved serum half-life compared with short-acting versions, which the company intends to progress through a clinical and regulatory pathway in an undisclosed orphan and rare gastrointestinal indication.

NB-1001 has demonstrated efficacy and an extended half-life up to 30 days in a 70-patient clinical study¹ and received orphan drug designation by the U.S. Food and Drug Administration. The companies, along with Cedars-Sinai Medical Center, plan to initiate a clinical program in SBS in 2020, with the goal of developing a safer, more efficacious and convenient therapy.

"People living with Short Bowel Syndrome have unique, unmet motility needs and NB-1001 is one of the only compounds in development to directly address this by potentially allowing for elimination of parenteral nutrition and an improvement in quality of life," said Mark Pimentel, MD, FRCPC, executive director of the Medically Associated Science and Technology (MAST) program at Cedars-Sinai. The patent rights covering the use of NB-1001 are owned by Cedars-Sinai Medical Center and are exclusively licensed by Cedars-Sinai to Naia.

H. Daniel Perez, M.D., co-founder, chairman and CEO of Naia Rare Diseases, said, "The potential behind the combination of these companies is powerful. We believe the high-caliber, experienced team will advance our exciting pipeline, as they share our commitment of bringing innovative new medicines to patients suffering from SBS and other debilitating gastrointestinal rare diseases with few options."

About Short Bowel Syndrome
According to the National Institute of Diabetes, and Digestive and Kidney Diseases (NIDDK), SBS is a rare syndrome of problems related to poor absorption of nutrients as a result of at least half of the small intestine being removed and sometimes all or part of the large intestine; significant damage to the small intestine; or poor motility, or movement inside of the intestines.² The incidence of SBS is poorly known but estimated at about 5 to 10 patients per year per million population. In adults, the incidence of SBS requiring at-home parenteral nutrition is estimated at two adult patients per year per million population.³ The only approved pharmacologic therapies for SBS include trophic factors, such as short-acting daily injectable GLP-2 analogues, which may not be appropriate for all patient types.

About the Transaction
Pursuant to the LOI, the combined company will acquire all of the outstanding capital stock of Naia in exchange for an undisclosed amount of cash and equity. The Naia acquisition would be expected to close after the merger of RDD and Innovate to create 9 Meters Biopharma, Inc. Closing is subject to the negotiation of a definitive agreement, customary legal and regulatory clearances and procedures. The corporate headquarters for the combined company will be located in Raleigh, North Carolina. Wyrick Robbins Yates & Ponton LLP and Shibolet & Co. are serving as legal counsel to RDD, and Dorsey and Whitney LLP is serving as legal counsel to Naia.

About Naia Rare Diseases
Naia Rare Diseases is a development stage biopharmaceutical company developing novel drugs for rare gastrointestinal disorders. The company is pursuing three development programs including NB 1001 for Adult SBS, NB 1001 for pediatric SBS and NB 1002, a GLP-2 agonist, for an undisclosed orphan gastrointestinal indication. Naia Rare Diseases has been funded by an international syndicate of private investors, and was founded by Naia Limited, a company focused on building new biotech companies using de-risked clinical stage assets. For more information, please visit www.naiapharma.com.

About RDD Pharma
RDD Pharma, Ltd. ("RDD"), is a privately held biopharmaceutical company focused on orphan and innovative therapies for gastrointestinal disorders. The company has two clinical stage products which serve significant unmet needs. RDD-0315 is currently in Phase 2 development for the treatment of fecal incontinence in spinal cord injury patients. RDD-0315 has received Orphan Drug status in the E.U. and Fast Track designation in the U.S. RDD-1609 is being developed for the treatment of Pruritus Ani. For more information, please visit www.rddpharma.com.

About Innovate Biopharmaceuticals, Inc.
Innovate is a clinical stage biotechnology company focused on developing novel therapeutics for autoimmune and inflammatory diseases. Innovate's lead drug candidate, larazotide acetate, has a mechanism of action that renormalizes the dysfunctional intestinal barrier by decreasing intestinal permeability and reducing antigen trafficking, such as gliadin fragments in celiac disease, and bacterial toxins and immunogenic antigens in NASH. In celiac disease, larazotide is the first-ever drug to enter Phase 3 registration trials. Larazotide has been exposed to nearly 600 subjects in clinical trials demonstrating a favorable safety profile comparable to placebo for long-term chronic administration. Larazotide has received Fast Track designation from the FDA for celiac disease. For more information, please visit www.innovatebiopharma.com.

Forward-Looking Statements
This press release includes forward-looking statements based upon Naia's and RDD's current expectations. Forward-looking statements involve risks and uncertainties, and include, but are not limited to, statements about the structure, timing and completion of the proposed transactionr; expectations regarding the ownership structure of the combined company; the future operations of the combined company; the nature, strategy and focus of the combined company; the development and commercial potential and potential benefits of any product candidates of the combined company; anticipated preclinical and clinical drug development activities and related timelines, including the expected timing for data and other clinical and preclinical results; the company having sufficient resources to advance its pipeline; and other statements that are not historical fact. Actual results and the timing of events could differ materially from those anticipated in such forward-looking statements as a result of these risks and uncertainties, which include, without limitation: (i) the risk that the conditions to the closing of the proposed transaction are not satisfied; (ii) the ability of RDD and Naia to enter into a definitive agreement, (iii) uncertainties as to the timing of the consummation of the proposed transaction and the ability of the parties to consummate the proposed transaction; (iv) risks related to integration of the companies; (v) risks related to the failure or delay in obtaining required approvals from any governmental or quasi-governmental entity necessary to consummate the proposed transaction; (vi) potential unexpected costs, charges or expenses resulting from the transaction; (vii) potential adverse reactions or changes to business relationships resulting from the announcement or completion of the proposed transaction; (viii) the uncertainties associated with the clinical development and regulatory approval of product candidates; (ix) risks related to the inability of the combined company to obtain sufficient additional capital to continue to advance these product candidates and its preclinical programs; (x) uncertainties in obtaining successful clinical results for product candidates and unexpected costs that may result therefrom; (xi) risks related to the failure to realize any value from product candidates and preclinical programs being developed and anticipated to be developed in light of inherent risks and difficulties involved in successfully bringing product candidates to market; and (xii) risks associated with the possible failure to realize certain anticipated benefits of the proposed transaction, including with respect to future financial and operating results. Actual results and the timing of events could differ materially from those anticipated in such forward-looking statements as a result of these risks and uncertainties. You should not place undue reliance on these forward-looking statements, which are made only as of the date hereof or as of the dates indicated in the forward-looking statements. Innovate expressly disclaims any obligation or undertaking to release publicly any updates or revisions to any forward-looking statements contained herein to reflect any change in its expectations with regard thereto or any change in events, conditions or circumstances on which any such statements are based.

Contact:
RDD Pharma, Ltd.
Susan Forman
Media Contact
Tel: +1-212-825-3210
Email: [email protected]
www.rddpharma.com

Naia Rare Diseases
H. Daniel Perez, MD
Chief Executive Officer
Mark Bagnall
Chief Financial Officer
Email: [email protected]
Email: [email protected]
www.naiapharma.com

References:

1. Data presented at the 71^st American Diabetes Association conference (2011)
2. NIH Health Information – Short Bowel Syndrome
3. Amiot A, Messing B, Corcos O, Panis Y, Joly F. Determinants of home parenteral nutrition dependence and survival of 268 patients with non-malignant short bowel syndrome. Clin Nutr 2013;32(3):368—74.

SOURCE RDD Pharma

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