Discovery Partners to merge with Infinity Pharmaceuticals to focus on cancer drug discovery

By E. Janene Geiss

Philadelphia, April 12 - Discovery Partners International, Inc. and Infinity Pharmaceuticals, Inc. announced Wednesday that they have entered into a definitive merger agreement to create a new public company focused on cancer drug discovery and development. Infinity is currently private.

Infinity, operating from its current headquarters in Cambridge, Mass., will be the resulting Nasdaq-traded biopharmaceutical company with a lead product candidate in multiple phase 1 clinical trials, a second product candidate scheduled to enter the clinic in late 2006, a pipeline of proprietary small molecule preclinical candidates and partnerships with Novartis, Johnson & Johnson and Amgen, according to a company news release.

It is anticipated that, on a pro forma basis, cash and cash equivalents for the combined company as of March 31 would be in excess of $100 million, officials said. This will provide Infinity with sufficient funding to generate efficacy data on its lead program and continue to advance the remainder of Infinity's current pipeline.

Under terms of the agreement, Discovery Partners will issue shares so that Infinity stockholders will own 69% of the combined company and Discovery stockholders will own about 31%, assuming Discovery's net cash at closing is between $70 and $75 million, officials said. These percentages are subject to adjustment based on Discovery's net cash at closing.

The merger agreement has been approved by both companies' boards of directors and will need to be approved by both companies' stockholders.

Upon closing, the new company's common stock is expected to trade on the Nasdaq National Market under the name Infinity Pharmaceuticals, Inc. for which the company has reserved the symbol "INFI". DPI's current ticker symbol, "DPII" will become inactive, officials said.

The new company's products in development include IPI-504, Infinity's lead anti-cancer product candidate that selectively inhibits Heat Shock Protein 90 in cancerous cells; IPI-504, which is being evaluated in two ongoing phase 1 trials in patients with relapsed, refractory multiple myeloma and relapsed, refractory gastrointestinal stromal tumors; and

IPI-609, Infinity's second novel, proprietary anti-cancer agent, in late-stage preclinical research.

Infinity is a Cambridge, Mass., drug discovery and development company.

Discovery Partners is a San Diego small molecule and natural product-based drug discovery company.

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