Constellation Alpha Capital Corp., a special purpose acquisition company, has executed a non-binding Letter of Intent to merge with DermTech, Inc., a molecular genomics company with an initial focus on skin cancer. DermTech markets and develops products that facilitate the early detection of skin cancers, assess inflammatory diseases, and help customize drug treatment. DermTech analyzes skin samples collected non-invasively using an adhesive patch rather than a scalpel. DermTech's mission is to transform dermatology by delivering highly accurate and objective information to the clinician to improve care and reduce costs.
Mr. Rajiv Sarman Shukla, Chairman and Chief Executive Officer of Constellation, said, "DermTech has developed a deep pipeline of dermatology-focused diagnostic tests with superior clinical sensitivity, improved patient comfort due to non-invasive sample collection and meaningful cost savings for payors. We are excited to bring this potential opportunity to our shareholders."
Dr. John Dobak, Chief Executive Officer of DermTech, said, "We look forward to completing this transaction, which will allow us to scale up commercialization of our skin cancer products, support the development of new products and expand our collaborations with pharmaceutical partners. DermTech has developed a unique diagnostic platform addressing large commercial opportunities, based on a foundation of science, clinical evidence and physician and patient value. This transaction provides us an opportunity to utilize and build upon our platform."
Under the terms of the proposed transaction, it is anticipated that DermTech will merge into a wholly-owned subsidiary of Constellation in exchange for shares of Constellation common stock. It is expected that DermTech shareholders will own a majority of the combined company's shares following the merger, but final ownership percentages will depend on the amount of redemptions by Constellation shareholders and the size of the anticipated private placement, if any. It is expected that the definitive agreement will contain a minimum cash closing condition of $15 million. The consummation of the transaction is contingent on, among other things, Constellation completing its legal and financial due diligence of DermTech and the parties negotiating and entering into a legally binding definitive agreement. A definitive agreement with respect to the transaction, if entered into, will provide that the closing of the transaction is subject to approval by Constellation's shareholders and the satisfaction of other closing conditions. The transaction is expected to close in the second quarter of 2019.