Shares of G1 Therapeutics, Inc. (NASDAQ: GTHX) stood firm during the previous session after a 0.42% rise to conclude at $7.09. That followed a significant stock price surge on Wednesday when GTHX gained traction on the charts driven by a definitive merger agreement news. GTHX stock surged 66.12% on the day to conclude the session at $7.06.
The Agreement
Pharmacosmos A/S and G1 Therapeutics (GTHX) have finalized their merger agreement. Pharmacosmos Therapeutics Inc., a Pharmacosmos subsidiary in the United States, will purchase all outstanding shares of G1 Therapeutics common stock in accordance with the terms of the agreement.
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At a price of $7.15 per share, the transaction will be paid for using cash, with an estimated $405 million of enterprise value for GTHX. To that bid amount, G1 Therapeutics is currently trading at a premium of 68%, and 133% above its 30-day volume-weighted average price.
Benefits and Implications
This transaction will have a substantial positive impact on G1 Therapeutics’ COSELA, the only medicine licensed by the US Food and Drug Administration to lessen chemotherapy-induced myelosuppression in adult patients with extensive-stage small cell lung cancer (ES-SCLC). The goal of Pharmacosmos and G1 Therapeutics is to increase the number of eligible patients with ES-SCLC who may get COSELA.
The merger will leverage G1’s established commercial, sales, and medical infrastructure alongside Pharmacosmos’s expertise in hematology and supportive care products, its extensive global presence, and substantial resources. This collaboration is expected to enhance COSELA’s market penetration and optimize outreach to oncologists.
By giving cancer patients more access to COSELA and giving stockholders a significant premium, the transaction adds significant value for all parties involved in G1 Therapeutics. Pharmacosmos has agreed to purchase all issued and existing shares of G1 Therapeutics common stock for $7.15 per share through a cash tender offer.
Pharmacosmos’s current credit facilities and cash reserves will be used to finance the deal. Pharmacosmos will pay the same amount for any shares that remain after the tender offer is completed through a second-step merger. The common stock of G1 Therapeutics will be delisted from public trading when the transaction closes.
