VTYX Stock Rises on Strategic Equity Investment Deal With SNY

Zacks Equity Research

Tue, Sep 24, 2024, 8:24 AM 3 min read

Shares of Ventyx Biosciences VTYX gained 7% on Monday after the company announced that it has entered into a $27 million strategic investment agreement with Sanofi SNY. Per the terms of the deal, Sanofi will buy 70,601 of Ventyx’s Series A non-voting convertible preferred stock for $3.8243 per share. Per the press release, each acquired preferred stock will initially be converted into 100 shares of common stock.

The proceeds from this investment are anticipated to enhance Ventyx’s cash reserves. With the addition of these funds, the combined total of current cash, cash equivalents and marketable securities is expected to support the company's planned operations until at least the second half of 2026.

VTYX Grants SNY Exclusive Rights to Investigational Drug

In return for the $27 million equity investment, Ventyx has granted Sanofi the exclusive opportunity to first negotiate certain rights related to the clinical programs of VTYX’s investigational candidate, VTX3232. Notably, VTX3232 is an oral, selective, central nervous system (CNS)-penetrant NLRP3 inhibitor, which is being developed for various neuroinflammatory and neurodegenerative indications, including Parkinson’s disease, cardiometabolic disease, Alzheimer’s disease and multiple sclerosis.

Ventyx believes that this strategic deal with Sanofi underscores the potential of VTX3232 to offer a disease-modifying treatment for CNS indications with significant unmet medical needs. The company will also be able to utilize Sanofi’s large resources and prowess in developing treatments for immunological and inflammatory diseases.

Year to date, shares of Ventyx have lost 0.4% compared with the industry‘s 1.5% decline.

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VTYX’s Development Programs for VTX3232

Currently, Ventyx is developing VTX3232 for the treatment of Parkinson’s disease and obesity. In early September, the company initiated a phase IIa study to evaluate VTX3232 in patients with early Parkinson’s disease. Top-line results are expected in 2025.

Ventyx is also currently gearing up to initiate a separate 12-week phase II study of VTX3232 by the end of 2024 in patients with obesity and additional cardiovascular and cardiometabolic risk factors. The planned study will assess the impact of VTX3232 on key inflammatory biomarkers and weight change, both as a monotherapy and in combination with a GLP-1 receptor agonist (RA). Top-line data from this obesity study of VTX3232 is also expected in 2025.