Medicus Pharma proposes $135M SkinJect spinout through SPAC business combination

And uh yesterday we announced uh a uh contemplated spin-off at a pre-money value of 135 million uh where Skinjet will become a standalone company.

All right, welcome back inside our Proactive Newsroom and joining me now is Dr. Raza Bokari. He is the CEO of Medicus Pharma. And Dr. Bokari, it's great to see you again. How are you?

I'm doing really well, Steve. Thank you so much for having me back on your program.

Yeah, well, exciting news out from the company talking about uh uh proposing a a spin out of Skinjet and this is obviously one we've talked about for a long time in the past and and we'll we'll talk about the spin out in just a second, but let's remind everyone about the Skinjet platform and and what what you're doing with it.

Yeah, indeed, uh Steve, we are very, very excited of uh the uh the developments uh which we believe are a major step forward for realizing uh Skinjet as a novel therapy for uh uh for basal cell lesions manifesting in a rare autosomal dominant disease called Golden Syndrome.

Uh we started three years ago, as your viewers uh would remember with their support and patience, uh where we took control of this uh distressed asset which had a very uh unique and a novel uh biology and and scientific outlook, uh but was a financially distressed company that we took control and began to advance these dissolvable micro needle arrays tip loaded with a uh chemo therapeutic agent that came out of Carnegie Melon and University of Pittsburgh.

And uh yesterday we announced uh a uh contemplated spin-off at a pre-money value of $135 million where Skinjet will become a standalone company.

So, we are very excited about this. This validates our business model and it's a big step forward towards that validation. Something that we took at a $25 million value, three years later with the uh the advancement in the program, and now uh a a potential of a standalone company.

Yeah, so why why decide to go this particular route? Is it is it just that Skinjet is the the platform that can be used for a number of different things and it really fits better in a standalone company?

So, uh uh uh not only that, uh uh uh and I really appreciate that insightfulness. Skinjet or these dissolvable microneedle arrays are a platform technology. and the possibilities are endless. Our focus has been this non melanoma basal cell lesions and then we refined that and made it very exclusive for basal cell lesions in the uh for Golden Syndrome patients, but uh but the skin jet needle uh could microdose additional uh APIs and use in other technologies.

So not only that that is a very valid reason for this to be a standalone in its own uh in its own right, but also the Medicus model is to buy and take control of these assets. Uh get them through a proof of concept study and with registrational trappings and other uh late stage development success, pass it on uh to others uh and monetize. And uh through this uh uh de-SPAC process that we have initiated, which is non-binding at this stage, but we are very uh optimistic that we will realize it to the finish line.

Uh it also uh uh creates a uh uh monetary inflection point for us. So we have it validates our business model and the continued focus now goes in the hands of a standalone company where we seek to remain majority uh owners, uh both in terms of shareholders uh shareholder stake as well as the the voting stake. So, it is uh what we think is a is a very good outcome.

And just quickly on the on the timing of all this now, it has to go through, obviously, it'll be a lot of lawyer time, put it that way. So what happens sort of next? What should people understand about the next steps?

So the next steps are to enter into a uh a definitive business combination agreement, uh and also uh uh uh confirm a concurrent financing uh to continue the program. Uh the Skinjet program uh we're very thrilled that through the support of our shareholders uh in these last two years. We have advanced it uh substantially by deploying uh the capital that we have raised and on a go forward basis, uh we have stated elsewhere and continue to uh to state that the total uh projected spend, uh R&D spend over next two years before it qualifies to the extent that the scientific rigor has been satisfied to apply for a new drug application is no more than $3 million.

So, we uh uh also have to make sure that the the NewCo that will uh uh uh will emerge through this business combination agreement uh also has sufficient capital uh on day one so that it can continue the journey forward and that also uh minimizes and reduces the pressure on our uh uh uh financial uh balance sheet. So, this is uh a a beneficial uh with respect to being capital efficient. It is beneficial for the Medicus shareholders not only to realize this potential immediate upside of valuation uh upside from 25 million to now contemplated to 135 million, but to continue to maintain ownership in Skinjet as it advances as a standalone company, hopefully as a commercial enterprise sooner rather than later and bringing a solution and a treatment to the ones uh that need it the most.

If I may very quickly say, the Golden Syndrome patients have no approved FDA therapy uh in the market. So this would be the first. Uh and so we are very, very uh excited of what lies ahead and I hope we can deliver on what we have contemplated through this uh letter of intent that we have executed earlier this week.

All right, we'll keep an eye on everything. Dr. Bakari, thank you so much. Good to see you again.

Thank you again, Steve. Uh always a pleasure uh uh to be with you.

All right, there's Dr. Raza Bakari, the CEO of Medicus Pharma.