As Silverback admits defeat, ARS troops forward to fund commercialization of epinephrine nasal spray

ARS Pharmaceuticals is backing onto Nasdaq through a reverse merger with Silverback Therapeutics to bag cash to commercialize an epinephrine nasal spray and win market share from the incumbent EpiPen.

San Diego-based ARS plans to file for FDA approval of the nasal spray, branded Neffy, in individuals who weigh at least 30 kg in the third quarter, putting it on track to start selling the product in the U.S. next year. In anticipation of the launch, ARS has been on the lookout for funding—and identified Silverback as a company that can fuel its plans.

Silverback went public late in 2020, raising $242 million in an IPO intended to bankroll the development of a pipeline led by SBT6050. The candidate consisted of a TLR8 agonist conjugated to a HER2-directed monoclonal antibody. Silverback stopped development in March in response to lackluster data. 

With the retreat from TLR8 wiping out two programs, Silverback was left with a preclinical hepatitis B candidate and enough cash to see it through to 2026. However, the biotech has now decided a reverse merger with ARS represents a better bet than plowing the cash into the preclinical program.

ARS expects Silverback to have net cash of around $240 million when the merger closes, a sum that will give shareholders in the floundering biotech a 37% stake in the combined company. Infused with money from Silverback, ARS expects to emerge from the merger with $265 million—enough cash to fund it for at least three years.

Over that time, ARS could bring its epinephrine nasal spray to market and put a big dent in the market share of Viatris’ injectable allergic reaction incumbent EpiPen. Last year, ARS predicted that 60% of users of epinephrine pens would immediately switch to Neffy and that 80% of users would convert within two years.