Following an unsuccessful merger attempt with MEI Pharma, Infinity Pharma has made the difficult decision to file for bankruptcy, a move that aligns with prior warnings from company executives when the merger fell through.
The Cambridge, Massachusetts-based biotech company officially filed for Chapter 11 bankruptcy on Friday, citing that this course of action was chosen “after considering all strategic alternatives,” as stated in a regulatory filing dated September 28. Despite this challenging situation, Infinity Pharma intends to maintain its operations at a reduced capacity while it explores restructuring options or potential asset sales.
In tandem with this development, Adelene Perkins, a board member, resigned from her position as chair.
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The challenges faced by Infinity Pharma intensified in July when the company was forced to make substantial cuts, reducing its staff by 75% and removing three board members, all in response to the failed merger with MEI Pharma. Back in March, Infinity had already voiced concerns that the merger might be its last opportunity to avert bankruptcy, particularly given its focus on cancer-related therapies. One of its key assets, eganelisib, was undergoing midstage studies for conditions like urothelial cancer and solid tumors. Despite concerted efforts to secure a strategic transaction to sustain its operations, Infinity Pharma was unable to secure a deal that could rescue the company.
Meanwhile, MEI Pharma has engaged in a public dispute, issuing press releases, with two of its shareholders, Anson Funds and Cable Car Capital LLC, as the two firms have been actively seeking to remove members from MEI’s board. In response to these actions, MEI implemented a stockholder rights plan, commonly referred to as a “poison pill defense,” on Monday, in an attempt to discourage these firms from gaining control.