Spherix Inc (NASDAQ:SPEX) investors cheer the news that the technology firm has negotiated definitive terms to acquire a controlling interest in Hoth Therapeutics, a development stage biopharmaceutical company focused on the development of therapeutics for patients suffering from atopic dermatitis, such as eczema. Closing of the deal with Hoth is subject to the completion and execution of customary closing documents, which the Company expects to be completed within 30 days or less.
Spherix shares reacted to the news, rising nearly 14% in Tuesday’s trading session.
Hoth Therapeutics is the licensee of proprietary, patented, drug compounds developed at the University of Cincinnati. Eczema is a disease which results in inflammation of the skin and characterized by rash, red skin, and itchiness. According to a GlobalData PharmaPoint research report, eczema impacts millions of Americans and expected to represent a $5.6 billion market by 2022.
Anthony Hayes, the CEO of Spherix stated, “Hoth is an exciting pharmaceutical company that has licensed the rights to compounds developed at the University of Cincinnati and that have achieved positive results in initial studies conducted at the University of Miami. In addition, Hoth believes it will have the advantage of a shorter than average FDA approval process, with the ability to start Phase 505(b)(2) FDA testing. This advantage may result in lower development costs and shorter development time. Moreover, Hoth’s BioLexa platform uses its unique technology to treat eczema without the use of traditional topical steroids.”
Mr. Hayes went on to state that, “The dermatology space offers attractive returns and exits. For example, Pfizer’s May 16, 2016 decision to acquire Anacor Pharmaceuticals for approximately $5.2 billion reinforces the continuing interest in and value placed on novel dermatology treatments by big pharma. Anacor’s main drug at the time of acquisition by Pfizer was a topical treatment for mild to moderate atopic dermatitis.”
Mr. Hayes further stated, “The medical importance and excitement associated with the dermatology space, was an important consideration to management. We believe that this investment is an accretive value to our shareholders, which is in addition to value of our other businesses that we are continuing to develop. We believe this transaction demonstrates our continued efforts to drive shareholder value.”
Spherix, Inc. operates as an intellectual property company that owns patented and unpatented intellectual property. Its principal activities include the acquisition and development of patents through internal or external research and development. In addition, the company intends to acquire existing rights to intellectual property through the acquisition of already issued patents and pending patent applications, both in the U.S. and abroad. The firms patent portfolio consists of patents in the fields of wireless communications, satellite, solar and radio frequency, as well as 2 U.S. patents in pharmaceutical technology.