Diffusion Pharma’s stockholders support merger with EIP Pharma

The stockholders of Diffusion Pharmaceuticals have approved a merger with EIP Pharma, which is on track to close on 16 August.

Diffusion’s stockholders approved all proposals as part of a special meeting, including the issuance of Diffusion Common Stock and a reverse stock split of outstanding Diffusion Common Stock, based on the 15 August press release.

Specifically, 71% of stockholders voted in favour of the transaction, while 73% voiced their support for the Reverse Split. The combined company is expected to have cash runway through the trial until the end of 2024, based on a 30 March press release.

If all goes ahead, the soon-to-be merged companies will begin trading as CervoMed under the trading symbol CRVO when NASDAQ opens on 17 August.

The merger’s approval marks a further development in Diffusion’s strategic review process. In October 2022, Diffusion authorised the evaluation of additional strategic opportunities, which included joint ventures, licensing, and the company’s sale, in addition to previously announced options.

The strategic review was followed by the announcement of a merger between Diffusion and EIP Pharma that would lead to a combined company focused on neurodegenerative diseases, based on the 30 March press release.

Diffusion was previously developing its lead candidate trans sodium crocetinate, for patients with conditions such as stroke, which are often complicated by hypoxia. The combined company will now work on developing EIP Pharma’s pipeline and particularly the drug neflamapimod, a small molecule p38MAP kinase alpha (p38a) inhibitor, which plays a major role in inflammation-induced synaptic toxicity that results in synaptic dysfunction. On 14 August, EIP Pharma announced that it dosed the first patient in the Phase IIb RewinD-LB trial (NCT05869669) that studies neflampimod’s use in dementia with Lewy bodies.