Regado Biosciences (RGDO), Tobira Therapeutics Enter Merger Agreement

Regado Biosciences (NASDAQ: RGDO) and Tobira Therapeutics, Inc. announced that they have entered into a definitive agreement under which privately-held Tobira will merge with a wholly-owned subsidiary of Regado in an all-stock transaction. The merger will create a company focused on the development of novel treatments for liver and inflammatory diseases. Tobira's lead product, immunomodulator and anti-fibrotic agent cenicriviroc (CVC), received Fast Track Designation and is currently in a Phase 2b trial in non-alcoholic steatohepatitis (NASH). Upon closing of the transaction, Regado will be renamed Tobira Therapeutics, Inc., and will be under the leadership of Tobira's chief executive officer, Laurent Fischer, M.D.

A Tobira investor syndicate has committed to invest up to $22 million in the combined company. This financing is expected to fully fund the CVC development program through the completion of the Phase 2b program. The financing is expected to close before or concurrently with the completion of the merger with Leerink Partners and Oppenheimer & Co. expected to act as financial advisors. All of Tobira's preferred stock investors, including Domain Associates, Novo Ventures, Frazier Healthcare, Montreux Equity Partners and Canaan Partners, have committed to participate in the financing. Total cash balance of the combined company following the closing of the merger and the financing is expected to be approximately $60 million.

"Following an extensive and thorough review of strategic alternatives, we believe the proposed merger with Tobira provides the opportunity for substantial returns for Regado shareholders," said Michael A. Metzger, Regado's president and chief executive officer. "We expect Tobira to be the next breakout company in NASH based on the best-in-class profile and potential of their lead drug CVC. The merged company will derive a significant advantage from the extensive clinical, commercial and transactional expertise of the combined board and management teams. We are optimistic that the strength of the leadership team, coupled with the cash Regado will contribute to the merger, will enable CVC to reach significant value inflections in the near term."

Laurent Fischer, M.D., chairman and chief executive officer of Tobira, said, "The merger and concurrent financing will allow the company to fully fund Tobira's ongoing Phase 2b CENTAUR study of CVC in patients with NASH and liver fibrosis. We expect to have top line data from the study in the second quarter of 2016. In addition, the strong closing balance sheet allows us to expand our NASH program with additional studies of CVC in non-alcoholic fatty liver disease and combination settings that will help position CVC as a cornerstone therapy for this troubling complication of the ongoing obesity epidemic."

CVC is a first-in-class immunomodulator and the only compound in development for NASH that targets inflammation and fibrosis. CVC has been evaluated in approximately 580 subjects across clinical programs. CVC is being evaluated in patients with NASH for its potential to reduce liver inflammation and slow down or reverse progression of liver fibrosis or progression to cirrhosis.

The CENTAUR study is a randomized, double-blind Phase 2b study of a single 150 mg tablet of CVC given once daily versus placebo in patients with NASH and liver fibrosis. CENTAUR is an international study with planned treatment centers across North America, Europe, Hong Kong and Australia. The study will enroll approximately 250 patients and will evaluate the non-alcoholic fatty liver disease (NAFLD) activity score (NAS) and resolution of NASH without worsening of liver fibrosis after one and two years of treatment as compared to placebo. These endpoints are aligned with findings and recommendations from an American Association for the Study of Liver Diseases (AASLD) – FDA joint workshop that identified potentially acceptable surrogate endpoints for clinical studies of agents for NASH and liver fibrosis, a disease for which no treatments are approved.

Details of the Proposed Transaction

On a pro forma basis and based upon the number of shares of Regado common stock to be issued in the merger, current Regado shareholders will own approximately 32% of the combined company and current Tobira shareholders will own approximately 68% of the combined company (determined before accounting for the financing transaction discussed above). The actual allocation will be subject to adjustment based on Regado's net cash balance. The transaction has been approved by the board of directors of both companies. The merger is expected to close in the second quarter of 2015, subject to the approval of the stockholders of each company as well as other customary conditions.

MTS Health Partners, L.P., and Cowen and Company, LLC, served as financial advisors, and Cooley LLP served as legal counsel to Regado and Gunderson Dettmer LLP served as legal counsel to Tobira with respect to the transaction.

Management and Organization

Following the merger, the company will be led by Dr. Fischer as chief executive officer. The board of directors of the combined company will be comprised of nine representatives, three of whom will be designated by Regado and the remaining six of whom will be designated by Tobira. Dennis Podlesak, current chairman of Regado's board, will be chairman of the board of the combined company. The corporate headquarters will be located in South San Francisco, California.

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