Reneo Pharmaceuticals, OnKure enter all-stock merger agreement

Reneo Pharmaceuticals and OnKure announced that they have entered into a definitive merger agreement to combine the companies in an all-stock transaction. The combined company will focus on advancing OnKure’s pipeline candidates targeting oncogenic mutations in phosphoinositide 3-kinase alpha, including its lead program OKI-219, which is currently in a Phase 1 clinical trial for the treatment of solid tumors. Upon completion of the transaction, the combined company is expected to operate under the name OnKure Therapeutics, Inc., and trade on the Nasdaq Global Market under the ticker symbol “OKUR”. In connection with the transaction, Reneo Pharmaceuticals has entered into a subscription agreement for a $65 million private investment in public equity financing expected to close concurrently with the closing of the merger, with a group of institutional investors, including Acorn Bioventures, Cormorant Asset Management, Deep Track Capital, Perceptive Advisors, Samsara BioCapital, Surveyor Capital, and Vestal Point Capital. The transactions are subject to stockholder approval by both companies, the effectiveness of a registration statement to be filed with the U.S. Securities and Exchange Commission, a condition that Reneo Pharmaceuticals have at least $55 million in net cash at the closing, the continued listing of the combined company on Nasdaq, and satisfaction of other customary closing conditions. Including proceeds from the concurrent PIPE financing, the combined company is expected to have approximately $120 million of cash, cash equivalents, and short-term investments at closing. The merger and concurrent PIPE financing are expected to close in 2024. In February 2024, OnKure initiated a first-in-human clinical trial to evaluate OKI-219, a mutant-selective PI3KalphaH1047R inhibitor. The PIKture-01 trial is a Phase 1 dose-escalation trial designed to evaluate the safety, tolerability, pharmacokinetics, pharmacodynamics, and efficacy of OKI-219 as a monotherapy in patients with advanced solid tumors and in combination with endocrine therapy or HER-2 targeted therapy in patients with advanced breast cancer. Pre-merger Reneo stockholders are expected to own approximately 31% of the combined company, and pre-merger OnKure stockholders are expected to own approximately 69% of the combined company, upon the closing of the merger, exclusive of the PIPE financing. The percentage of the combined company that each company’s former stockholders are expected to own may be adjusted based on Reneo’s net cash at closing. The transaction has been unanimously approved by the board of directors of both companies and is expected to close in 2024, subject to customary closing conditions, including approval by the stockholders of each company. Following the merger, the combined company will be led by Nicholas Saccomano, Ph.D., President and Chief Executive Officer of OnKure, and other members of the OnKure management team. Reneo Pharmaceuticals will be renamed “OnKure Therapeutics, Inc.” and the corporate headquarters will be located in Boulder, CO. The merger agreement provides that the board of directors of the combined company will be composed of eight members, including six board members chosen by OnKure and two members from the legacy Reneo board.