ARCA biopharma and Oruka Therapeutics announce merger agreement

ARCA biopharma, Inc. (NASDAQ: ABIO) and Oruka Therapeutics have announced a definitive agreement to merge in an all-stock transaction, poised to reshape the chronic skin disease treatment landscape.

The new entity, retaining the name Oruka Therapeutics, Inc., will focus on advancing a pipeline of potentially best-in-class biologics, including ORKA-001 and ORKA-002, targeting IL-23p19 and IL-17A/F respectively.

The merger is backed by a robust $275 million investment from a syndicate of healthcare investors, ensuring a solid financial foundation to propel Oruka’s innovative programs through initial clinical proof-of-concept.

With a projected cash balance sufficient to fund operations through 2027, the combined company’s strategy is firmly set on clinical development with efficiency and precision.

Lawrence Klein, PhD, CEO of Oruka, expressed optimism about the merger’s potential to significantly improve the standard of care for individuals with chronic skin conditions.

“Our engineered programs could offer unprecedented freedom from diseases like psoriasis,” said Klein.

Oruka’s ambition extends to transforming the treatment paradigm for plaque psoriasis and related diseases by developing long-acting antibodies.

The company’s co-lead programs, ORKA-001 and ORKA-002, are expected to enter clinical trials in 2025, with the promise of less frequent dosing and superior efficacy compared to existing treatments.

Dr. Andrew Blauvelt, chair of Oruka’s Scientific Advisory Board, highlighted the potential of Oruka’s lead programs to build upon recent advancements in the field.

“The KNOCKOUT study’s findings on IL-23 inhibition have set the stage for Oruka’s programs to offer more effective, durable, and less frequent treatment options,” he stated.

The merger has received unanimous approval from both companies’ Boards of Directors and is anticipated to close in the third quarter of 2024, subject to stockholder approval and other customary closing conditions.

Post-merger, ARCA stockholders are expected to own approximately 2.38% of the combined company, with Oruka stockholders owning the remainder.

The combined company will be led by a distinguished Board of Directors, including industry leaders from Fairmount, CRISPR Therapeutics, Spyre Therapeutics, and Apogee Therapeutics, ensuring a wealth of expertise to guide Oruka Therapeutics into a new era of healthcare innovation.