Citius Pharmaceuticals and TenX Keane Merge to Form Citius Oncology

Citius Pharmaceuticals Inc. (NASDAQ: CTXR), a late-stage biopharmaceutical company, announced that shareholders of TenX Keane Acquisition (NASDAQ: TENK) have voted to approve the business combination between TenX Keane and Citius Pharma’s oncology subsidiary. The newly combined public company will be renamed Citius Oncology, Inc. and continue trading on the Nasdaq stock exchange.

In October, Citius announced it was spinning out its wholly-owned oncology unit to form Citius Oncology, a standalone publicly traded entity. Under the terms of the deal, Citius Pharma is receiving 65.6 million shares of common stock of Citius Oncology, representing approximately 90% of the newly public company.

As part of the transaction, Citius Pharma will contribute $10 million in cash to Citius Oncology. Additionally, 12.75 million existing options will be assumed by Citius Oncology. The cash remaining in TenX’s trust account, along with the cash from Citius Pharma, will be used for working capital and general corporate purposes following the transaction.

Citius previously stated that the SPAC deal is expected to unlock significant value for Citius shareholders by separating the oncology business, potentially leading to increased access to capital markets and further development of new applications and additional intellectual property. This move underscores Citius’ strategy to acquire assets, develop them, bring them to market, and unlock shareholder value.

Citius Oncology will serve as a platform to develop and commercialize novel targeted oncology therapies. The first product to go to market will be LYMPHIR, a recombinant fusion protein designed to treat T-cell lymphomas. The drug combines the interleukin-2 (IL-2) receptor binding domain with diphtheria toxin fragments, targeting IL-2 receptors on the cell surface to inhibit protein synthesis. LYMPHIR has received orphan drug designation from the FDA for the treatment of peripheral T-cell lymphoma (PTCL) and Cutaneous T-cell lymphoma (CTCL).

Citius acquired an exclusive license to develop and commercialize LYMPHIR in all markets except for Japan and certain other parts of Asia. In March, the FDA accepted Citius’s Biologics License Application (BLA) for LYMPHIR, with a decision expected on August 13, 2024. If approved, Citius is preparing for LYMPHIR commercialization later this year.

Leonard Mazur, CEO of Citius, emphasized the strategic benefits of the SPAC deal, stating that it enables the company to acquire a Nasdaq listing while preventing shareholder dilution. Mazur, who has invested $22.5 million of his own money in the business, anticipates that Citius Oncology will be profitable during its first year on the market, benefiting Citius shareholders.