Kadimastem’s attempt to vault onto Nasdaq is picking up momentum, with shareholders signing off on a merger with NLS Pharmaceutics that would enable the cell therapy developer to recover from last year’s thwarted listing attempt.
Israel-based Kadimastem is developing a pipeline of off-the-shelf cell therapy candidates led by a potential treatment for amyotrophic lateral sclerosis (ALS). Eleven months ago, the biotech signed a non-binding agreement to merge with IM Cannabis in a deal that would give it a Nasdaq listing. That deal fell through after the legalization of cannabis in Germany persuaded IM to back out of the merger.
By July, Kadimastem had signed a binding term sheet with NLS, a biotech that went public in 2021. NLS halved its headcount and began looking for strategic alternatives in 2023. Kadimastem identified NLS as a way to get its stock listed on Nasdaq.
The Israeli biotech’s shareholders are on board with the plan. With Kadimastem’s shareholders voting in favor of the merger, NLS is planning to arrange a meeting of its investors to get final approval for the deal in the coming weeks.
If the deal goes through, Kadimastem will secure the opportunity to tap U.S. public investors for money to fund its pipeline of cell therapies. Cash is tight—the merger requires NLS and Kadimastem to have just $600,000 and $3.5 million, respectively, at closing—and the Israeli biotech wants to start a phase 2a trial of its ALS candidate in the U.S. shortly after the deal closes.
Kadimastem is planning to advance the cell therapy on the strength of a phase 1/2a trial that treated 10 patients before COVID-19 led the biotech to stop the study. The trial linked the use of the cell therapy to a slowdown in ALS disease progression over the first three months. However, the pace of deterioration returned to its pretreatment rate at the 6- and 12-month assessments.