NEW YORK – Reneo Pharmaceuticals and OnKure will merge in an all-stock transaction, and the combined company will focus on advancing OnKure's pipeline of cancer therapies targeting oncogenic mutations in PI3Kα.
In connection with the merger announced Monday, Reneo has entered into a subscription agreement for a $65 million private investment in public equity (PIPE) financing with a group of institutional investors. The investor group includes Acorn Bioventures, Cormorant Asset Management, Deep Track Capital, Perceptive Advisors, Samsara BioCapital, Surveyor Capital, and Vestal Point Capital.
Both the merger and the PIPE financing, expected to close concurrently in 2024, must be approved by stockholders in both companies. The closing conditions include that Reneo must have at least $55 million in net cash excluding proceeds from the PIPE financing, and that the combined company must be listed on the Nasdaq. The combined company is expected to have about $120 million in cash, cash equivalents, and short-term investments at closing.
The new publicly traded company will advance OnKure's pipeline of PI3Kα inhibitors in molecularly defined tumor types, including its lead compound OKI-219 in cancers harboring PI3Kα H1047R mutations. In February, Boulder, Colorado-based OnKure began testing OKI-219, a mutant-selective PI3Kα H1047R inhibitor, in the Phase I PIKture-01 trial as a monotherapy in patients with advanced solid tumors and in combination with endocrine therapy or Genentech's HER2-targeted agent Herceptin (trastuzumab) in patients with advanced breast cancer.
Approximately 15 percent of breast cancers and 4 percent of all solid tumors have PI3Kα H1047R mutations. In the dose optimization portion of the study, in addition to having PI3Kα H1047R mutations, breast cancer patients must have hormone receptor-positive, HER2-negative disease to receive OKI-219 and fulvestrant, and have HR-positive, HER2-positive disease to receive the OKI-2019 and Herceptin combination.
In preclinical xenograft models heterozygous for PI3Kα H1047R mutation, OnKure researchers saw strong, single-agent activity for OKI-219 including tumor regressions. At the same time, preclinical models showed no evidence of toxicities related to wild-type PI3Kα inhibition based on markers of hyperglycemia, even at very high doses. The drug has also shown synergistic activity with selective estrogen receptor degraders.