NextCure and Avere Therapeutics have entered into a definitive agreement to merge in an all-stock transaction that will create a publicly traded biotechnology company focused on developing oral therapies for inflammatory diseases driven by interleukin-23.
The transaction is being supported by a concurrent $320 million private placement led by Fairmount and Hansoh Pharmaceutical Group. The financing is expected to provide the combined company with sufficient capital to advance Avere’s lead drug candidate, AVR-001, through several major clinical development milestones.
Upon completion of the merger, the combined company is expected to operate under the Avere Therapeutics name and trade on the Nasdaq under the ticker symbol “AVRX.” The transaction is expected to close during the second half of 2026, subject to stockholder approvals, regulatory requirements, and other customary closing conditions.
AVR-001 is an oral cyclic peptide designed to block the IL-23 receptor. The investigational therapy is being developed as a potentially convenient once-weekly treatment for psoriasis and other inflammatory diseases.
The drug candidate has been engineered with a half-life of approximately 100 hours, which supports once-weekly oral dosing. Avere believes this dosing profile could differentiate AVR-001 from first-generation oral IL-23 inhibitors that require daily administration.
Clinical data from a Phase 1b study conducted by Hansoh in patients with moderate-to-severe plaque psoriasis showed responses after four weeks of once-weekly treatment. Avere said the Week 4 and Week 8 Psoriasis Area and Severity Index results and PASI 75 response rates were comparable on a cross-trial basis to those reported for a first-generation once-daily oral inhibitor.
The results also suggested that AVR-001 may have durable pharmacodynamic activity. The therapy was generally well tolerated after four weeks of treatment, with an adverse-event profile that Avere believes supports continued clinical development.
A U.S. Investigational New Drug application for AVR-001 is open. Avere expects to begin a Phase 2b psoriasis study in early 2027 and anticipates reporting results during the first half of 2028.
Hansoh is separately conducting a Phase 2b psoriasis study in China, with results expected in 2027.
The combined company’s financing is expected to fund operations through the completion of a global Phase 2b psoriasis trial, the initiation of a Phase 3 psoriasis study, and the start of a Phase 2b trial in ulcerative colitis.
Avere also sees potential opportunities to develop AVR-001 for Crohn’s disease, psoriatic arthritis, and other inflammatory conditions in which the IL-23 pathway has been clinically validated.
The $320 million private placement includes $251 million of convertible notes, along with accrued interest, that will be exchanged for common stock when the merger closes.
In addition to Fairmount and Hansoh, participating investors include Venrock Healthcare Capital Partners, General Atlantic, Janus Henderson Investors, Wellington Management, Boyu Capital, Sirona Capital, funds and accounts advised by T. Rowe Price Investment Management, RTW Investments, Sirenia Capital Management, Logos Capital, Redmile, Affinity Asset Advisors, Balyasny Asset Management, Wedbush Healthcare Partners, and other institutional investors.
Avere recently entered into an exclusive licensing agreement with Hansoh covering the development, manufacturing, and commercialization of AVR-001 outside Greater China.
Under that agreement, Hansoh will receive upfront payments totaling $120 million. Hansoh is also eligible for up to $2.18 billion in development and sales milestone payments, along with royalties ranging from the mid-single digits to the low-double digits on product sales.
The merger provides Avere with access to NextCure’s public market infrastructure while giving NextCure stockholders an opportunity to retain an interest in the development of AVR-001.
At closing, existing NextCure stockholders are expected to own approximately 1.21% of the combined company. Existing Avere stockholders, including investors participating in the pre-closing financing, are expected to own approximately 98.79%.
The final ownership percentages may be adjusted based on NextCure’s estimated net cash immediately before the transaction closes.
NextCure stockholders are also expected to receive a contingent value right. The CVR will entitle them to 90% of the net proceeds generated from any future licensing, divestiture, or other monetization of NextCure’s existing pipeline assets and programs during the two years following the merger’s completion.
Avere’s current executive team will lead the combined company. Andrew Cheng, MD, PhD, will serve as Chief Executive Officer, President, and Chairman of the Board.
The leadership team will also include Kitty Yale as Chief Development Officer, William White as Chief Financial Officer and Head of Corporate Development, and Brett Pletcher as General Counsel.
Members of the Avere management team previously helped lead Akero Therapeutics from its pre-initial-public-offering stage through its sale to Novo Nordisk for up to $5.2 billion in December 2025.
Avere’s existing directors will become members of the combined company’s board. The board will be chaired by Cheng and will include Julianne Bruno of Fairmount and two representatives from Hansoh. Nimish Shah of Venrock Healthcare Capital Partners is also expected to join the board before the transaction closes.
The boards of directors of both NextCure and Avere have approved the transaction.
Wedbush Securities is serving as Avere’s exclusive strategic financial advisor, while Gibson, Dunn & Crutcher is acting as its legal counsel. Jefferies and Wedbush & Co. are serving as placement agents, with Cooley acting as legal counsel to the placement agents.
Tungsten Advisors is serving as NextCure’s financial advisor, and Sidley Austin is acting as its legal counsel.
KEY QUOTES:
“The combination of the strong clinical data from Hansoh’s Phase 1b psoriasis study, the capital raised through this financing from a world-class investor syndicate, and immediate access to the public markets positions us to be highly competitive in the emerging oral IL-23 market. We have a clear line of sight to potentially value-generating clinical data and the resources to execute our plans. We are focused on rapidly delivering a once-weekly oral IL-23 therapy that combines best-in-class convenience with efficacy competitive with other emerging oral IL-23 therapies.”
Andrew Cheng, MD, PhD, CEO of Avere Therapeutics
“Since our founding, NextCure has been committed to advancing innovative therapies designed to improve outcomes for patients. I am incredibly proud of the dedication, talent, and perseverance of the NextCure team and the important contributions they have made in pursuit of our mission. We are pleased to announce this transaction with Avere, which represents a compelling opportunity for NextCure’s stockholders to participate in the development of once-weekly AVR-001 and its significant therapeutic and commercial potential. NextCure’s Board of Directors and management team are in full support of this transaction, and we believe Avere’s strong balance sheet and experienced management team are well-positioned to successfully execute on the development plans for AVR-001.”
Michael Richman, President and CEO of NextCure
