US-based Eliem Therapeutics has announced a definitive agreement for the acquisition of development-stage private biotechnology company Tenet Medicines.

The acquisition is aimed at enhancing Eliem’s portfolio with a clinical-stage programme targeting unmet needs in autoimmune diseases.

The deal is supported by a securities purchase agreement in which Eliem will sell 31,238,282 shares at $3.84 each, expecting to raise gross proceeds of $120m.

The private placement will see investments from investors including RA Capital Management, Boxer Capital, Deep Track Capital, Pontifax and Samsara Biocapital.

Following the acquisition and private placement, the cash reserves of the merged business will be $210m.

This will support operations until 2027 and achieve significant milestones for TNT119, an anti-CD19 antibody.

TNT119 is being developed for autoimmune diseases including systemic lupus erythematosus and immune thrombocytopenia.

The merged company plans to advance the development of this asset.

The boards of directors of Eliem and Tenet have given unanimous approval for the transaction.

The acquisition and private placement will conclude in the middle of 2024.

Tenet CEO Stephen Thomas stated: “Our team brings deep experience in immune disorders and on the heels of positive preliminary Phase I data for TNT119 in membranous nephropathy, we are excited to begin Phase II clinical development in systemic lupus erythematosus and immune thrombocytopenia.

“We believe that TNT119 has best-in-class potential and could be a transformative treatment option for many patients suffering from debilitating autoimmune disorders.

“This transaction and the support from leading life sciences investors will allow us to accelerate our development plans and continue advancing TNT119 for the potential benefit of patients.”