We've updated our Privacy Policy to make it clearer how we use your personal data. We use cookies to provide you with a better experience. You can read our Cookie Policy here.


CYBIN Signs Definitive Agreement to Acquire Adelia Therapeutics

CYBIN Signs Definitive Agreement to Acquire Adelia Therapeutics content piece image
Credit: Halacious/ Unsplash
Listen with
Register for free to listen to this article
Thank you. Listen to this article using the player above.

Want to listen to this article for FREE?

Complete the form below to unlock access to ALL audio articles.

Read time: 4 minutes

Cybin Inc. (NEO:CYBN) (“Cybin” or the “Company”), a life sciences company focused on psychedelic pharmaceutical therapies, today announced the signing of a definitive agreement to acquire 100% of the shares in Adelia Therapeutics Inc. (“Adelia”) for up to CDN$20,161,575 (approximately USD$15.75 million) in an all-stock transaction (the “Transaction”). The Transaction is subject to the satisfaction or waiver of customary conditions, including the receipt of all applicable regulatory and NEO Exchange Inc. (the “NEO Exchange”) approvals.

Adelia is an innovative biopharmaceutical company committed to addressing unmet mental health needs through the development of proprietary psychedelic therapeutics with improved dosing efficacy and therapeutic indices. Adelia’s leadership team brings a wealth of clinical development experience and major academic research affiliations, including the Massachusetts Institute of Technology, Harvard, Stanford, Yale, and Northeastern University.

“We are thrilled to join forces with Adelia, as we see this transaction as potentially advancing Cybin’s ability to innovate our psychedelic drug development program and diversify beyond major depressive disorder. Adelia’s focus on creating novel therapeutics, including novel delivery methods and innovative therapeutic regimens can support our goal of creating therapies that result in faster onset of action, smoother pharmacokinetic profiles, shorter treatment durations, and reduced side effects. Leveraging Adelia’s expertise across multiple molecules and multiple indications could potentially allow Cybin to extend its reach and capability to address gaps across a larger domain,” stated Doug Drysdale, Chief Executive Officer of Cybin.

“Cybin is committed to expansion through strategic M&A opportunities. Today we deliver on that commitment and we will continue to pursue such opportunities to drive growth in the future,” concluded Drysdale.

Adelia’s founders, Alex Nivorozhkin, PhD (Chief Executive Officer) and Brett J. Greene (President, Chief Strategy Officer) bring decades of experience in psychedelics and drug development and are affiliated with Northeastern University’s world-renowned Center for Drug Discovery in Boston. Dr. Michael Palfreyman, Chief Operating Officer, is an accomplished pharmaceutical industry veteran responsible for more than 30 successful clinical programs. Collectively, Adelia’s talented team has deep expertise in drug discovery, development, clinical evaluation and commercialization; a wealth of highly cited peer-reviewed publications; 35 successful exits; and prestigious academic affiliations. Adelia’s senior leaders have overseen research and development and the market entry of major drugs such as Allegra (fexofenadine), Sabril (vigabatrin), Anzemet (dolasetron), and Vaniqa (eflornithine) and have been affiliated with major pharmaceutical companies including Johnson & Johnson, GlaxoSmithKline, Sanofi, Roche, Pfizer and Eli Lilly.

Management of Cybin intends to work with the Adelia team on a three pillar development strategy, each subject to the receipt of all necessary approvals: (a) the development of a novel drug discovery platform and to research the potential efficacy of psychedelic molecules to address unmet mental health needs; (b) the development of efficient drug delivery aimed at enhancing dosing control; and (c) the development of a potential novel treatment regimen. Adelia’s team has also laid out a three-year development plan (2021 – 2023), with the first year’s preclinical to clinical stage focused on application of the proprietary delivery and device platform; the second year’s clinical stage focused on developing new chemical entities with the aim of scaling up production; and the third year’s clinical trials stage to advance proprietary technologies and drug delivery devices.

Upon completion of the Transaction and subject customary approvals including approval of the Board and NEO Exchange, Alex Nivorozhkin, PhD, will assume the title of Chief Scientific Officer; Michael G. Palfreyman, PhD, DSc, will assume the role of Chief Research and Development Officer; and Brett Greene will assume the role of Chief Innovation Officer for Cybin.

“Cybin brings complementary resources to the table, and together we can advance our shared goal of bringing psychedelic therapies across a broad spectrum of indications. This transaction positions us well for growth in the public market and gives us access to the capital needed to advance these projects from the bench, through the clinic, and ultimately to the patients who desperately need them. We have a great deal of respect for Doug and his team and look forward to the opportunity to transform the psychedelic therapeutics industry together,” stated Alex Nivorozhkin, PhD, Co-Founder and Chief Executive Officer of Adelia.

Transaction Details

Cybin entered into a contribution agreement (the “Transaction Agreement”) with Cybin Corp., Cybin US Holdings Inc. (“Acquiror”), a wholly-owned subsidiary of Cybin created for the purposes of the Transaction, and all of the shareholders of Adelia (the “Adelia Shareholders”), whereby the Adelia Shareholders agreed to contribute to the Acquiror all of the issued and outstanding common shares of Adelia (the “Adelia Shares”) in exchange for non-voting Class B common shares in the capital of the Acquiror (the “Class B Shares”).

Upon closing of the Transaction (the “Closing”), the Adelia Shareholders will contribute all of the Adelia Shares to the Acquiror as a capital contribution in exchange for Acquiror issuing to them, in the aggregate, 868,833 Class B Shares in accordance with their respective pro rata percentages at a price per Class B Share equal to CAD$12.40 (approximately US$9.69). The aggregate value of the Class B Shares to be issued to the Adelia Shareholders on the Closing is CDN$10,773,529.50 (approximately USD$8.42 million).

The Class B Shares issued by the Acquiror to the Adelia Shareholders are exchangeable for common shares in the capital of Cybin (the “Cybin Shares”) on a 10 Cybin Shares for 1 Class B Share basis, at the option of the holder thereof, subject to customary adjustments. Notwithstanding the foregoing, no Class B Shares are exchangeable prior to the first anniversary of Closing and not more than: (i) 33 1/3% of the Class B Shares will be exchangeable prior to the second anniversary of Closing; (ii) 66 2/3% of the Class B Shares will be exchangeable prior to the third anniversary of Closing; and (iii) thereafter, 100% of the Class B Shares will be exchangeable. The Class B Shares to be issued to the Adelia Shareholders upon the Closing are exchangeable for a total of 8,688,330 Cybin Shares, resulting in an effective issue price of $1.24 per Cybin Share.

Further, on the occurrence of certain milestone events (each a “Milestone”), subject to customary approvals, the Acquiror will issue to the Adelia Shareholders such number of Class B Shares as shall be determined by dividing the applicable milestone consideration, as set out in the Transaction Agreement, by the greater of: (i) CDN$0.75; and (ii) the greater of: (a) the 10 day volume weighted average price of the Cybin Shares; and; (b) the market price of the Cybin Shares on the close of business on the last business day preceding the relevant date upon which Cybin issues a press release announcing the achievement of such Milestone (or if the Milestone is not of a character requiring a press release, on the date that is three business days following the determination that the relevant Milestone has been met). If a particular Milestone has not been achieved by the close of the quarter immediately following the quarter in which such Milestone is scheduled for completion, the Acquiror’s obligation to issue Class B Shares on the occurrence of the applicable Milestone shall expire. The total value of the Class B Shares issuable pursuant to the Milestones is up to CDN$9,388,045.50 (approximately US$7.33 million), assuming all Milestones are met prior to the applicable deadlines.

Pursuant to the Transaction Agreement, upon the Closing and subject to Board and other customary approvals, certain members of the Adelia team will enter into advisory and/or executive employment arrangements with Cybin upon the Closing and, in such capacity, are expected to receive, in the aggregate, a grant of options to purchase up to 2,244,100 to acquire Cybin Shares, pursuant to Cybin’s equity incentive plan, exercisable for a period of five (5) years and subject to vesting. The exercise price will be determined at the time of grant. An additional 555,900 options to acquire Cybin Shares will be issuable to eligible participants at the direction of the Adelia team, from time to time, after Closing.

Cybin has agreed to pay, on behalf of Adelia, an advisory fee to Nova Capital International LLC of US$250,000 in connection with certain advisory services provided to Adelia relating to the Transaction