Scilex’s Semnur Pharmaceuticals, Denali Capital enter business combination

Semnur Pharmaceuticals, a wholly owned subsidiary of Scilex Holding (SCLX), and Denali Capital Acquisition (DECA) announce signing of a letter of intent for a proposed business combination, which provides for a pre-transaction equity value of Semnur of up to $2.0 billion, subject to adjustment based on third-party fairness opinion, with expected cash on hand at closing of up to $40 million depending on the number of SPAC shares that are redeemed prior to the completion of the business combination. The proposed business combination would create a publicly traded biopharma company and further provide investment into Semnur for the development of a non-opioid product, SP-102 (10 mg injectable dexamethasone sodium phosphate viscous gel), or SEMDEXA(TM), a Phase 3 novel non-opioid, viscous gel formulation of a widely used corticosteroid for epidural injections to treat lumbosacral radicular pain, or sciatica, with FDA Fast Track status. Anticipated proceeds from the proposed business combination are expected to fund Semnur’s lead program, SP-102, and a final Phase 3 study in connection with a potential New Drug Application filing with the FDA. Scilex is expected to be the majority holder of the combined company following completion of the proposed business combination. As previously disclosed, the Board of Directors of Scilex approved a resolution to authorize a potential dividend of up to 10% of the Scilex’s ownership interest in Semnur in connection with certain transactions, including a merger, subject to the registration of Semnur’s common stock with the Securities and Exchange Commission.