TARRYTOWN, N.Y. and BOSTON, MASS — In a significant move aimed at advancing breakthrough solutions for hearing loss, Regeneron Pharmaceuticals, Inc. (NASDAQ: REGN) and Decibel Therapeutics, Inc. (NASDAQ: DBTX) have announced a definitive agreement for the acquisition of Decibel by Regeneron.
The acquisition, valued at approximately $109 million, seeks to combine their expertise to drive the development of key gene therapy programs targeting congenital hearing loss. The agreement includes a cash payment of $4.00 per share of Decibel common stock at closing, with an additional contingent value right (CVR) offering the potential for up to $3.50 per share in cash. These additional payments are contingent upon achieving specific clinical and regulatory milestones for DB-OTO within defined timeframes. If these milestones are reached, the total equity value of the acquisition could amount to approximately $213 million.
The announcement comes less than a year after Eli Lilly acquired Akouos, a startup developing gene therapy treatments for hearing loss.
“We at Decibel are deeply committed to discovering and advancing innovative new therapies with the potential to be transformative for people with severe forms of hearing loss. We have built a pipeline of gene therapy product candidates for the ear that we believe have such potential. After full consideration, the Decibel Board has determined that this transaction is the best way to maximize shareholder value and ultimately benefit patients. We have collaborated with our colleagues at Regeneron for the past six years and have huge respect for their research and development capabilities. We have full confidence that with Regeneron’s expertise and resources the Decibel pipeline can be optimally developed, and our team is committed to enabling that long-term success.”
–Laurence E. Reid, Ph.D., President and CEO of Decibel
From Collaboration to Acquisition
The collaboration between Decibel and Regeneron was initially established in 2017 and was extended in 2021. Together, they have been working on three gene therapy programs focused on various forms of congenital, monogenic hearing loss. One of the programs, DB-OTO is currently in the global Phase 1/2 CHORDTM clinical trial, is an investigational cell-selective, adeno-associated virus (AAV) gene therapy designed to provide durable, physiological hearing to individuals with profound, congenital hearing loss caused by mutations of the otoferlin gene. Preclinical programs include AAV.103 for people with GJB2-related hearing loss and AAV.104 for people with stereocilin (STRC)-related hearing loss.
George D. Yancopoulos, M.D., Ph.D., Chief Scientific Officer and President of Regeneron, highlighted the importance of the acquisition:
“We are delighted to announce the planned acquisition of Decibel, who have been long-standing collaborators, notable for their deep scientific knowledge and commitment to people with hearing loss. DB-OTO, our shared lead investigational gene therapy, will soon reach patients in its first clinical trial, offering new promise to children with this rare form of congenital hearing loss, as well as potential proof-of-concept for future gene therapies addressing more common forms of genetic hearing loss. We believe that Decibel’s assets and specialized team will further strengthen our genetic medicines portfolio, enabling Regeneron to accelerate the development of innovative genetic therapies and a rich pipeline of hearing loss treatments.”
Accelerating Potential of Gene Therapy in Hearing Loss Treatment
Congenital hearing loss affects approximately 1.7 out of every 1,000 children born in the United States. While current interventions such as hearing aids and cochlear implants provide some benefits, they cannot fully restore normal hearing function. Gene therapy holds immense potential for addressing this unmet medical need and providing more effective solutions for hearing loss.
The acquisition process involves Regeneron’s subsidiary, Symphony Acquisition Sub, Inc., initiating a tender offer to acquire all outstanding shares of Decibel at a price of $4.00 per share in cash, along with the contingent value right (CVR). The deal is subject to certain conditions, including the tendering of a majority of Decibel’s outstanding shares, and is anticipated to close in the third quarter of 2023.
Regeneron’s legal advisor for the transaction is Wachtell, Lipton, Rosen & Katz. Centerview Partners LLC and Leerink Partners LLC are serving as Decibel’s financial advisors and Wilmer Cutler Pickering Hale and Dorr LLP is serving as Decibel’s legal advisor.
About Regeneron
Regeneron (NASDAQ: REGN) is a leading biotechnology company that invents life-transforming medicines for people with serious diseases. Founded and led for 35 years by physician-scientists, our unique ability to repeatedly and consistently translate science into medicine has led to nine FDA-approved treatments and numerous product candidates in development, almost all of which were homegrown in our laboratories. Our medicines and pipeline are designed to help patients with eye diseases, allergic and inflammatory diseases, cancer, cardiovascular and metabolic diseases, hematologic conditions, infectious diseases and rare diseases.
Regeneron is accelerating and improving the traditional drug development process through our proprietary VelociSuite® technologies, such as VelocImmune®, which uses unique genetically humanized mice to produce optimized fully human antibodies and bispecific antibodies, and through ambitious research initiatives such as the Regeneron Genetics Center, which is conducting one of the largest genetics sequencing efforts in the world.
About Decibel Therapeutics
Decibel Therapeutics is a clinical-stage biotechnology company dedicated to discovering and developing transformative treatments to restore and improve hearing and balance, one of the largest areas of unmet need in medicine. Decibel has built a proprietary platform that integrates single-cell genomics and bioinformatic analyses, precision gene therapy technologies and expertise in inner ear biology. Decibel is leveraging its platform to advance gene therapies designed to selectively replace genes for the treatment of congenital, monogenic hearing loss and to regenerate inner ear hair cells for the treatment of acquired hearing and balance disorders. Decibel’s pipeline, including its lead gene therapy product candidate, DB-OTO, to treat congenital, monogenic hearing loss, is designed to deliver on our vision of creating a world of connection for people with hearing and balance disorders.
