Scilex Holding Company (SCLX)

[georgie18]

SCLX...$1.22...Semnur Pharmaceuticals, Inc. (“Semnur”), a wholly owned subsidiary of Scilex Holding Company (Nasdaq: SCLX, “Scilex”), and Denali Capital Acquisition Corp. (Nasdaq: DECA, the “SPAC”) announce the signing of an agreement and plan of merger for a proposed business combination (the “Business Combination Agreement”), which provides for a pre-transaction equity value of Semnur of $2.5 billion. The Board of Scilex, Semnur, and Denali Capital Acquisition Corp. have approved the proposed transaction.

The proposed business combination would create a publicly traded biopharma company and further provide investment into Semnur for the development of a non-opioid product, SP-102 (10 mg injectable dexamethasone sodium phosphate viscous gel), or SEMDEXA™, a Phase 3 novel non-opioid, viscous gel formulation of a widely used corticosteroid for epidural injections to treat lumbosacral radicular pain, or sciatica, with FDA Fast Track status.

Based on the independent market research conducted by Syneos Health Consulting in 2020 and 2021, given the potential substantial utilization of SP-102 (SEMDEXA™), by the 5th year of launch, sales of SEMDEXA™ in sciatica are projected to reach $1.5 billion to $2.0 billion annually.

Scilex is expected to be the majority holder of the combined company following completion of the proposed business combination, which is expected to close by the first quarter of 2025; the combined company will be led by a management team with proven track record in industry experience.

As previously disclosed, the Board of Directors of Scilex approved a resolution to authorize a potential dividend of up to 10% of Scilex’s ownership interest in Semnur in connection with certain transactions, including a merger, subject to the registration of Semnur’s common stock (or such securities, property or other assets into which or for which such stock may be exchanged or converted in such a transaction) with the Securities and Exchange Commission (“SEC”). No record date has been set for such dividend and the Scilex board of directors may determine not to proceed with such dividend.