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INmune Bio (INMB) Purchases Xencor’s Option Potentially Eliminating Approx. 2.1M Shares of Future Dilution

By John F. Heerdink, Jr.
INmune Bio, Inc. is a publicly traded (NASDAQ: INMB), clinical-stage biotechnology company focused on developing treatments that target the innate immune system to fight disease. INmune Bio has two product platforms. The DN-TNF product platform utilizes dominant-negative technology to selectively neutralize soluble TNF, a key driver of innate immune dysfunction and mechanistic target of many diseases. DN-TNF is currently being developed for COVID-19 complications (Quellor™), cancer (INB03™), Alzheimer’s and Treatment Resistant Depression (XPro1595), and NASH (LIVNate™). The Natural Killer Cell Priming Platform includes INKmune™ aimed at priming the patient’s NK cells to eliminate minimal residual disease in patients with cancer. INmune Bio’s product platforms utilize a precision medicine approach for the treatment of a wide variety of hematologic malignancies, solid tumors and chronic inflammation.


Today, INmune Bio, Inc. (INMB), announced that it has entered into a new $15M credit facility with Silicon Valley Bank (SVB) and an affiliate of SVB Financial Group. INmune intends to use the proceeds from the facility to partially fund the buyout of an option held by Xencor, Inc., resulting from INmune’s in-licensing of XPro1595 (now known by its generic name, pegipanermin) in October 2017. XPro1595 is a next-generation inhibitor of tumor necrosis factor (TNF) that uses a dominant-negativeTNF technology that is very different from approved TNF inhibitors that block the effects of both soluble and trans-membrane TNF. Pegipanermin neutralizes soluble TNF, without affecting trans-membrane TNF or TNF receptors. XPro1595 could have substantial beneficial effects in patients with Alzheimer’s and other neurodegenerative diseases by decreasing neuroinflammation. Total consideration to be paid to Xencor by INmune is $18.3 million, comprised of $15 million of cash and $3.3 million of INMB shares at a price of $17.14 resulting in the issuance of 192,533 shares. Pursuant to the original 2017 in-licensing agreement, INmune granted Xencor an option to purchase an additional number of shares of common stock equal to 10% of INmune’s fully diluted company shares for a period of seven years. The retirement of the Xencor option eliminates an estimated 2.1 million shares of potential future common stock dilution upon exercise of the option.

 

David Szymkowski PhD, Vice President of Preclinical Operations at Xencor, Inc. (NASDAQ: XNCR)

INmune Bio has made significant progress to date on the development of XPro1595, including the announcement of encouraging data in Alzheimer’s disease earlier this year. XPro1595 is a novel approach to addressing the neuroinflammation implicated in a number of serious neurological indications, where more effective treatment options are desperately needed. We look forward to INmune’s continued progress as XPro1595 advances in multiple clinical studies,” stated David Szymkowski PhD, Vice President of Preclinical Operations at Xencor. Concurrent with this transaction, David Szymkowski, Ph.D., Vice President of Preclinical Operations at Xencor, stepped down from INmune’s Board of Directors.


 

RJ Tesi, MD, Chief Executive Officer of INmune Bio (NASDAQ: INMB)

“We are grateful to the team at Xencor for reaching this agreement and allowing us to simplify our capital structure. We remain acutely focused on the timely initiation of Phase 2 trials of XPro1595 in Alzheimer’s and treatment resistant depression later this year,” stated RJ Tesi, MD, Chief Executive Officer of INmune Bio: (INMB)


With Biogen’s (BIIB) historic FDA approval for Alzheimer’s now in the books as of June 7th (review story now),  we believe that it is opening the door for other approaches to be considered possibly on an expedited basis and that investors should seriously consider as well.  

VP Watchlist Stock, INmune Bio, Inc. (NASDAQ: INMB), a clinical-stage immunology company focused on developing treatments that harness the patient’s innate immune system to fight disease, confirmed on June 3rd via announcement that the United States Adopted Name Council (USAN) has adopted the name “Pegipanermin” for its lead clinical candidate, XPro1595.  The United States Adopted Names (USAN) Council is responsible for selecting simple, informative and unique nonproprietary (generic) drug names. The council and staff meet twice a year to discuss outstanding negotiations, new items of interest and policy issues. The USAN Council establishes logical nomenclature classifications based on pharmacological and/or chemical relationships. In addition to one member-at-large and a Food and Drug Administration (FDA) liaison, the council consists of one representative from each of the following: The American Medical Association (AMA), United States Pharmacopeia (USP) and the American Pharmacists Association (APhA). XPro1595 is a next-generation inhibitor of tumor necrosis factor (TNF) that uses a dominant-negativeTNF technology that is very different from approved TNF inhibitors that block the effects of both soluble and trans-membrane TNF. Pegipanermin neutralizes soluble TNF, without affecting trans-membrane TNF or TNF receptors. XPro1595 could have substantial beneficial effects in patients with Alzheimer’s and other neurodegenerative diseases by decreasing neuroinflammation. For more information about the importance of targeting neuroinflammation in the brain to improve cognitive function and restore neuronal communication visit this section of the INmune Bio’s website.

INmune Bio reported positive Phase 1b Alzheimer’s data in January 2021 demonstrating that XPro1595 decreased neuroinflammation and neurodegeneration biomarkers in patients with mild to moderate Alzheimer’s. The company is planning to initiate two Phase 2 clinical trials of XPro1595, in Alzheimer’s and Treatment Resistant Depression, in 2021. “Demonstrating changes in neuroinflammatory biomarkers across multiple measures (CSF and MRI) and assays in a small dataset gives us great confidence that XPro1595 is having the desired effect in the CNS. To see an impact on AD relevant disease pathways by three months that are sustained in patients that opted to enroll in the extension study for an additional nine months is more that we could have hoped for at this stage of development and will be of enormous value in planning the Phase 2 study.” said CJ Barnum, Ph.D., Head of Neurosciences at INmune Bio.

Shares of INmune Bio (INMB) closed trading today at $18.64, +4.19% after hitting $19.24 today. Its 52-wk range is $4.5-$29.99. Shares of this low float biotech (~14.93M outstanding w/ 29.81% insider ownership) stock have been on significant upward move since we added the company to the VP Watchlist in May when the stock was in the $9 range.

INMB closed Q1/2021 with cash of $45.3M, which management believes is enough to fund operations into Q4/2022.  Per our beliefs, INMB’s biggest value generator is its Phase 1 AD program, with additional results due later this year and their Phase 2 to start in in the 2nd half of this year.

(Read Original Story: INmune Bio, Inc. Announces $15 Million Credit Facility to Purchase Xencor Option to Reduce Future Dilution in )


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