Drug development company Cempra Inc. has agreed to a merger with another drug company, Melinta Therapeutics Inc., for an undisclosed amount, according to an announcement Wednesday.
The shareholders of the Chapel Hill-based company will own 48 percent of the new company, which will be named Melinta Therapeutics, while the shareholders of Melinta Therapeutics will own 52 percent.
The board of the new company will have four members from each company’s existing board, as well as the CEO of the new company.
“The combined company’s extensive pipeline, including commercial, clinical and preclinical stage anti-infective programs with multiple products in development across several indications, provides an exceptional platform to deliver potential long-term growth and value for shareholders,” said acting Cempra Chief Executive Officer David Zaccardelli in a statement.
Cempra’s shares rose 17 cents, or 4.6 percent, to $3.97 in Wednesday morning trading. The new company will be traded on NASDAQ.
Last year, the U.S. Food and Drug Administration declined to approve Cempra’s bacterial pneumonia drug solithromycin, citing possible liver damage associated with the drug.
The FDA also took issue with the number of patients in the clinical trial, saying the 920 patients who took solithromycin did not represent a large enough sample to study its effects on the liver.
Solithromycin has also found in a study conducted by the company not to be more effective in treating gonorrhea than the treatment combination of two already approved antibiotics: a ceftriaxone injection and oral azithromycin.
In February, Cempra cut 91 employees, trimming its workforce from 136 to 45 employees.
Cempra also reported second-quarter earnings on Wednesday that beat Wall Street expectations. The company reported a loss of 23 cents per share, compared to Wall Street estimates of a loss of 32 cents per share.
Revenue of $5.7 million in the second quarter exceeded Wall Street estimates of revenue of $3.45 million.
The deal is expected to close by the end of the year.