Reneo Pharmaceuticals and OnKure Announce Proposed Merger

Reneo Pharmaceuticals and OnKure Announce Proposed Merger

Merger to create a Nasdaq-listed, clinical-stage biopharmaceutical company focused on advancing OnKure’s portfolio of novel precision medicines in oncology

Combined company is expected to have approximately $120 million of cash resources at close, which is expected to provide funding through multiple clinical milestones and runway into fourth quarter of 2026

IRVINE - May 13, 2024 (GLOBE NEWSWIRE) -- Reneo Pharmaceuticals, Inc. (Nasdaq: RPHM) and OnKure, Inc., a privately-held, clinical-stage biopharmaceutical company focused on the development of novel precision medicines in oncology, today announced that they have entered into a definitive merger agreement to combine the companies in an all-stock transaction. The combined company will focus on advancing OnKure’s pipeline candidates targeting oncogenic mutations in phosphoinositide 3-kinase alpha (PI3Kα), including its lead program OKI-219, which is currently in a Phase 1 clinical trial for the treatment of solid tumors. Upon completion of the transaction, the combined company is expected to operate under the name OnKure Therapeutics, Inc., and trade on the Nasdaq Global Market under the ticker symbol “OKUR”.

In connection with the transaction, Reneo Pharmaceuticals has entered into a subscription agreement for a $65 million private investment in public equity (PIPE) financing expected to close concurrently with the closing of the merger, with a group of institutional investors, including Acorn Bioventures, Cormorant Asset Management, Deep Track Capital, Perceptive Advisors, Samsara BioCapital, Surveyor Capital (a Citadel company), and Vestal Point Capital. The transactions are subject to stockholder approval by both companies, the effectiveness of a registration statement to be filed with the U.S. Securities and Exchange Commission, a condition that Reneo Pharmaceuticals have at least $55 million in net cash at the closing (excluding proceeds from the concurrent PIPE financing), the continued listing of the combined company on Nasdaq, and satisfaction of other customary closing conditions.

Including proceeds from the concurrent PIPE financing, the combined company is expected to have approximately $120 million of cash, cash equivalents, and short-term investments at closing. The merger and concurrent PIPE financing are expected to close in 2024.

In February 2024, OnKure initiated a first-in-human clinical trial to evaluate OKI-219, a mutant-selective PI3KαH1047R inhibitor. The PIKture-01 trial is a Phase 1 dose-escalation trial designed to evaluate the safety, tolerability, pharmacokinetics, pharmacodynamics, and efficacy of OKI-219 as a monotherapy in patients with advanced solid tumors and in combination with endocrine therapy or HER-2 targeted therapy in patients with advanced breast cancer.

“Following a thorough evaluation of strategic alternatives, the Reneo board of directors and management team believe that this anticipated transaction represents a compelling opportunity to deliver shareholder value as the OnKure team advances their PI3Kα inhibitors,” said Mike Grey, Executive Chairman and founder of Reneo Pharmaceuticals. “OnKure has an experienced team of drug developers, and we are excited about the potential for OKI-219 to become a meaningful treatment option for patients suffering from breast cancer.”

“We are pleased to announce our proposed merger with Reneo Pharmaceuticals, allowing us to create a publicly traded company focused on advancing OnKure’s lead, mutant-specific programs targeting PI3Kα in breast cancer. This opportunity comes at an important time for OnKure as we recently initiated our PIKture-01 trial of OKI-219 and expect early clinical data in the fourth quarter of this year,” said Nicholas Saccomano, President and Chief Executive Officer of OnKure.

About PI3Kα and OKI-219
PI3Kα is the most frequently mutated oncogene in cancers, and PI3KαH1047R is the most common mutation in this gene, being found in 15% of breast cancer and 4% of cancers overall. While novel drugs targeting PI3Kα have been approved, the lack of mutant selectivity of these therapeutics drives considerable on-target toxicity by inhibiting the normal version of this protein in various tissues. To address this challenge, OnKure is discovering and developing a portfolio of highly mutant-selective PI3Kα inhibitors with the goal of improving efficacy and safety with molecules that fully inhibit the mutant oncogene while sparing the wild-type enzyme in normal tissues. OKI-219 is a potential best-in-class, orally bioavailable, highly selective inhibitor of PI3KαH1047R with approximately 80-fold selectivity for the mutated form of the enzyme compared to wild-type. OnKure believes that the wild-type-sparing properties of OKI-219 should significantly improve the activity and safety relative to currently approved agents. OKI-219 is currently in Phase 1 of clinical development in solid tumor patients with PI3KαH1047R mutations, including breast cancer.

About the Proposed Merger
Pre-merger Reneo stockholders are expected to own approximately 31% of the combined company, and pre-merger OnKure stockholders are expected to own approximately 69% of the combined company, upon the closing of the merger, exclusive of the PIPE financing. The percentage of the combined company that each company’s former stockholders are expected to own may be adjusted based on Reneo’s net cash at closing.

The transaction has been unanimously approved by the board of directors of both companies and is expected to close in 2024, subject to customary closing conditions, including approval by the stockholders of each company.

Management and Organization
Following the merger, the combined company will be led by Nicholas Saccomano, Ph.D., President and Chief Executive Officer of OnKure, and other members of the OnKure management team. Reneo Pharmaceuticals will be renamed “OnKure Therapeutics, Inc.” and the corporate headquarters will be located in Boulder, CO. The merger agreement provides that the board of directors of the combined company will be composed of eight members, including six board members chosen by OnKure and two members from the legacy Reneo board.

Leerink Partners is acting as exclusive financial advisor to Reneo for the transaction. Jones Day and Cooley LLP are serving as legal counsel for Reneo. Leerink Partners, Evercore ISI and LifeSci Capital are serving as the placement agents for the PIPE financing. Covington & Burling LLP is serving as legal counsel to the placement agents in connection with the PIPE financing. Oppenheimer & Co. is serving as capital markets advisor to OnKure. Wilson Sonsini Goodrich & Rosati, P.C. is serving as legal counsel to OnKure.

About Reneo Pharmaceuticals
Reneo is a pharmaceutical company historically focused on the development and commercialization of therapies for patients with rare genetic mitochondrial diseases, which are often associated with the inability of mitochondria to produce adenosine triphosphate.

About OnKure
OnKure, Inc. is a clinical-stage biopharmaceutical company focused on the discovery and development of best-in-class precision medicines that target biologically validated drivers of cancers that are underserved by available therapies. Using structure-based drug design portfolio, OnKure is building a pipeline of tumor-agnostic candidates that are designed to achieve optimal efficacy and tolerability. OnKure is currently developing OKI-219, a selective PI3KαH1047R inhibitor, as its lead program. OnKure aims to become a leader in targeting oncogenic PI3Kα and has multiple programs designed to enable best-in-class targeting of this key oncogene.

#Reneo Pharmaceuticals


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