Armata Pharmaceuticals, Inc. (ARMP)

A new medical research center in San Diego is embracing an innovative way to treat antibiotic resistant infections called bacteriophage therapy—phage therapy for short—which uses viruses as weapons against hard-to-treat infections.

Antibiotic-resistant infections are part of a growing global health problem. Each year in the United States, at least two million people contract drug-resistant infections, and 23,000 die from those illnesses. Bacteria naturally grow resistant to the drugs used to treat them, and for people with especially tough infections that aren’t responding to the usual medications, the options are limited...

...Phages are ubiquitous viruses—there are more of them than any other organism in the world—that fight bacteria. They do this by injecting their DNA into bacteria cells, where they rapidly replicate and cause bacteria to burst and die. For the most part, each phage strain attacks a specific kind of bacteria, so if scientists harness phages in the right way, they could offer a more personalized approach to treating resistant infections than broad-spectrum antibiotics, which decimate a wide variety of bacteria (including the good strains).

AmpliPhi Biosciences Announces Presentation of Positive Clinical Data From its Expanded Access Program for Serious S. aureus Infections at IDWeek 2018 Conference

• 13 patients with serious and life-threatening S. aureus infections were treated with AB-SA01 at the Westmead Hospital in Sydney under AmpliPhi’s expanded access program
   Patients suffered from severe S. aureus bacteremia and sepsis, including infective endocarditis and prosthetic valve endocarditis
   83% (10 out of 12) patients in the modified intent-to-treat (mITT) population achieved treatment success at the end of therapy as reported by treating physicians
   Bacteriophage treatment was well tolerated, with no adverse events attributable to the therapy

AmpliPhi Biosciences and C3J Therapeutics Agree to Merge

Transaction to result in NYSE American-listed company focused on development of precisely-targeted bacteriophage therapeutics

Merger combines AmpliPhi’s extensive phage library and Phase 1/2-ready asset with C3J’s expertise in synthetic phage and broad preclinical pipeline

$10 million to be invested by existing C3J shareholders upon closing

 

 

To the Shareholders of AmpliPhi Biosciences Corporation:
 

You are cordially invited to attend a special meeting of the shareholders of AmpliPhi Biosciences Corporation, a Washington corporation, which we refer to as “we”, “AmpliPhi”, or the “Company”, which will be held at 8:30 a.m., local time, on May 8, 2019, at Cooley LLP, 4401 Eastgate Mall, San Diego, California 92121, unless postponed or adjourned to a later date. This is an important meeting that affects your investment in AmpliPhi.
 

On January 3, 2019, AmpliPhi and C3J Therapeutics, Inc. (“C3J”) entered into an Agreement and Plan of Merger and Reorganization (as amended, the “Merger Agreement”), pursuant to which Ceres Merger Sub, Inc., a wholly owned subsidiary of AmpliPhi, will merge with and into C3J, with C3J surviving as a wholly owned subsidiary of AmpliPhi, and AmpliPhi common stock will be issued to the former C3J shareholders at the effective time of such merger (the “Merger”). Immediately following the Merger, we anticipate that the securityholders of AmpliPhi as of immediately prior to the Merger will own approximately 30% of the aggregate number of shares of AmpliPhi common stock and the former C3J shareholders will own approximately 70% of the aggregate number of shares of AmpliPhi common stock (in each case on a fully diluted basis but using the treasury stock method and excluding out-of-the-money options and out-of-the-money-warrants, and determined before accounting for the financing transaction discussed below). The Merger has been unanimously approved by the boards of directors of both companies and is expected to close in May 2019, subject to approval of AmpliPhi’s shareholders as well as other customary conditions.
 

On February 5, 2019, AmpliPhi and C3J entered into share purchase agreements with certain shareholders of C3J (the “Investors”), pursuant to which AmpliPhi will sell, and the Investors have agreed to buy, in a private placement, shares of AmpliPhi common stock immediately following the effective time of the Merger, having an aggregate purchase price of  $10.0 million (the “Financing”). The AmpliPhi shares of common stock to be issued in the Financing will be sold at a price per share equal to $40.0 million divided by the total number of shares of AmpliPhi’s common stock outstanding on a fully diluted, as-converted basis, excluding out-of-the-money options, out-of-the-money warrants, shares reserved for issuance under equity incentive plans that are not subject to outstanding awards, and shares issuable in the Financing. Immediately following the closing of the Merger and the Financing, the former C3J securityholders (including the Investors) are expected to own approximately 76% of the aggregate number of shares of AmpliPhi common stock (of which approximately 20% will be represented by the shares issued in the Financing to the Investors) and the securityholders of AmpliPhi as of immediately prior to the Merger are expected to own approximately 24% of the aggregate number of shares of AmpliPhi common stock (on a fully diluted basis but using the treasury stock method and in each case excluding out-of-the-money options and out-of-the-money-warrants). Additionally, given that the calculation of the price of the shares of AmpliPhi common stock to be sold in the Financing is tied to the number of shares outstanding immediately following the effective time of the Merger, the price per share of common stock sold in the Financing could be a discount to the closing price of our common stock as reported on the NYSE American on the execution date of the share purchase agreements for the Financing, February 5, 2019.
 

At the effective time of the Merger, the officers of AmpliPhi will include Todd R. Patrick, the current chief executive officer of C3J, who will become the chief executive officer of AmpliPhi, replacing Paul C. Grint, M.D., in such capacity, Brian Varnum, Ph.D., the chief development officer of C3J, who will become the president and chief development officer of AmpliPhi, Steve R. Martin, the current chief financial officer of AmpliPhi, who will retain his position as chief financial officer, and Duane Morris, the vice president, operations of C3J, who will become the vice president, operations of AmpliPhi. In addition, each of Louis Drapeau, Paul C. Grint, M.D., Wendy S. Johnson and Vijay Samant will resign from AmpliPhi’s board of directors effective upon the effective time of the Merger, and the designees of C3J pursuant to the Merger Agreement, Richard Bastiani, Ph.D., Richard Bear, H. Stewart Parker, Todd R. Patrick and Joseph M. Patti, Ph.D. will be appointed to fill the vacancies created by the resignations of the current AmpliPhi directors listed above. Following the Merger, the headquarters of AmpliPhi will be located in Marina del Rey, at C3J’s current headquarters.
 

Shares of AmpliPhi common stock are currently listed on the NYSE American under the symbol “APHB.” Prior to consummation of the Merger, AmpliPhi intends to file an initial listing application with the NYSE American pursuant to NYSE American “change of control” rules. After completion of the Merger, AmpliPhi will be renamed “Armata Pharmaceuticals, Inc.” and expects to trade on the NYSE American under the symbol “ARMP.”
 

AmpliPhi is holding a special meeting of shareholders (the “Special Meeting”) for the following purposes, as more fully described in the accompanying proxy statement:
 

1.  To approve the consummation of a Business Combination (as defined in AmpliPhi’s amended and restated articles of incorporation) pursuant to the Merger and the issuance of AmpliPhi common stock at the effective time of the Merger, as contemplated by the Merger Agreement;

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2.  To approve the issuance of shares of AmpliPhi common stock having an aggregate purchase price of  $10,000,000 immediately following the effective time of the Merger in a private placement financing transaction, as described in this proxy statement (the “Financing”);

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3.  To approve an amendment to AmpliPhi’s amended and restated articles of incorporation to effect a Reverse Split of AmpliPhi’s common stock (the “Reverse Split”) at a ratio in the range of between 1-for-3 to 1-for-20, inclusive, with such ratio to be determined in the discretion of AmpliPhi’s board of directors and with such Reverse Split to be effected prior to the effective time of the Merger;

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4.  To approve an amendment to AmpliPhi’s 2016 Equity Incentive Plan to increase the shares authorized for issuance thereunder by 13,822,963 shares (without giving effect to the Reverse Split) (the “EIP Amendment”);

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5.  To authorize the adjournment of the Special Meeting in order to permit the solicitation of additional proxies if there are not sufficient votes to approve Proposal Nos. 1 through 4 described above at the time of the Special Meeting; and

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6.  To transact any other business that may be properly brought before the meeting or any continuation, adjournment or postponement thereof.

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After careful consideration, AmpliPhi’s board of directors has determined that the Merger is fair to, and in the best interests of, AmpliPhi and its shareholders, has approved the Merger Agreement, the Merger, the issuance of shares of AmpliPhi common stock to C3J’s shareholders pursuant to the terms of the Merger Agreement and to certain C3J shareholders pursuant to the Financing, the amendment to AmpliPhi’s articles of incorporation to implement the Reverse Split, the EIP Amendment, and the other actions contemplated by the Merger Agreement, and has determined to recommend that the AmpliPhi shareholders vote to approve each of the proposals set forth in this proxy statement. Accordingly, AmpliPhi’s board of directors unanimously recommends that the AmpliPhi shareholders vote FOR each of the Proposal Nos. 1 through 4 described above; and FOR the authorization to adjourn the Special Meeting in order to permit the solicitation of additional proxies if there are not sufficient votes to approve Proposal Nos. 1 through 4 described above at the time of the Special Meeting.
 

Your vote is very important, regardless of the number of shares you own.    Whether or not you expect to attend the Special Meeting in person, please complete, date, sign and promptly return the accompanying proxy card in the enclosed postage paid envelope to ensure that your shares will be represented and voted at the Special Meeting.
 

More information about AmpliPhi, C3J and the proposed transactions is contained in this proxy statement. AmpliPhi urges you to read the accompanying proxy statement carefully and in its entirety. IN PARTICULAR, YOU SHOULD CAREFULLY CONSIDER THE MATTERS DISCUSSED UNDER “ RISK FACTORS ” BEGINNING ON PAGE 24 .