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LENZ Therapeutics Merges With Graphite Bio

BIOPHARMA: Company Developing Vision-Improving Eye Drops

SAN DIEGO – The biopharmaceutical company LENZ Therapeutics has completed its reverse merger with Graphite Bio, Inc., and the new combined public company is trading on Nasdaq under the ticker symbol LENZ.

Shortly before the merger, LENZ released successful results from a clinical trial of an eyedrop to improve near vision in many people, and CEO Eef Schimmelpennink said a New Drug Application will be submitted to the FDA in mid-year.

Eef Schimmelpennink
CEO
LENZ Therapeutics

The FDA will have one year to review the product, and Schimmelpennink said he expects it to go to market in the second half of next year.

The merger results in LENZ having a balance sheet of about $210 million and cash equivalents, including $53.3 million from Graphite’s agreement to undertake a private investment in public equity, or PIPE.

Inevitable Condition

LENZ, a late-stage clinical company, is developing the first aceclidine-based eye drop to improve near vision in people with presbyopia, the loss of elasticity of the lens, resulting in farsightedness in people as they age.

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“I didn’t know the word when I was approached by the company to be CEO, but I definitely have it,” Schimmelpennink said. “It happens to all of us, and there’s nothing you can do about it. I don’t know how you like your readers (reading glasses), but I hate them.”

Research shows that people 45 and older lose the ability to clearly see 1.5 lines on a near-vision eye chart every six years. In the United States, the condition is estimated to affect 128 million people.

The company’s product causes the iris to contract and create a pinhole effect on the pupil. Schimmelpennink said people experience the effect naturally when they are in bright sunlight and notice their near vision has improved.

Infusion of Investor Cash

Graphite Bio was a gene editing company that went public in June 2021 and traded on Nasdaq under the ticker symbol GRPH. The company raised $238 million and was developing genetic therapies for conditions including sickle cell disease, but paused the trial after a patient developed a serious side effect. Graphite Bio laid off half its workforce last year.

“Graphite Bio had a promising product, but had a failure with their first patient, so there was nothing left worth pursuing,” Schimmelpennink said. “The investors said, ‘We have all this cash, what do we do? Let’s find another company we like.’”

The cash influx will help LENZ’s workforce to grow from 30 to 50 by the end of the year and to 200 by the end of next year, he said.

Besides bringing in a large amount of cash, a reverse merger allows a private company to go public faster and less costly than the conventional initial public offerings.

Pre-merger Graphite Bio stockholders are expected to own approximately 30.8% of the combined company and pre-merger LENZ stockholders are expected to own about 56.2%.

The investors issued shares of common stock in the private placement are expected to own approximately 13% of the combined company.

Following the merger, key healthcare investors in LENZ will include Versant Ventures, RA Capital Management, Alpha Wave Global, Point72, Samsara BioCapital, Sectoral Asset Management, RTW Investments, and others.

The company is developing regulatory strategies and intends to seek partnerships for Europe, Canada, and other markets to maximize the value of its product.

LENZ has already entered into a license and collaboration agreement with Ji Xing for the development and commercialization of its eye drops for the treatment of presbyopia in Greater China.

Promising Clinical Trials

LENZ intends to launch its product in the United States with its own commercial organization. Schimmelpennink said it is expected to require a prescription and cost about $80 a bottle, the price of an eyedrop developed by another company to improve near vision.

That product was launched about two years ago and had an enthusiastic reception for a few months, but interest waned as it was effective for only one in four people and lasted for just two and a half or three hours, Schimmelpennink said.

The latest clinical trials of the LENZ product showed 71% of subjects had improvements of three eye chart lines within 30 minutes, and 40% of people still had a three-line improvement more than 10 hours.

On day 28 of the trials, 223 participants were surveyed on their experience and 90% indicated they noticed an improvement in their near vision and 75% said they would want to continue to use the eye drops after the study.

LENZ Therapeutics
FOUNDED: 2013
CEO: Eef Schimmelpennink
HEADQUARTERS: Del Mar
BUSINESS: Ophthalmic pharmaceuticals
EMPLOYEES: 30
STOCK: Nasdaq: LENZ
WEBSITE: lenz-tx.com
SOCIAL IMPACT: The company’s product could mean millions of people will no longer need reading glasses.
NOTABLE: The merger leaves LENZ with a strong balance sheet of about $210 million.

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