United States-based Sevion Therapeutics has agreed to acquire Eloxx Pharmaceuticals, a company that is focused on developing therapeutics for genetic diseases caused by non-sense mutations, it was reported yesterday.

According to the terms of the contract, Eloxx will become a wholly owned subsidiary of Sevion. Upon completion of the deal, Sevion will change its name to Eloxx Pharmaceuticals Inc and aims to apply to have its shares listed for trading on NASDAQ.

Eloxx shareholders will receive shares of Sevion's common stock indicating around 70% of Sevion's issued and outstanding share capital. Both parties aim to raise around USD24m in private equity investment rounds as a condition prior to the acquisition transaction.

Dr Silvia Noiman, CEO of Eloxx, said, 'The transaction with Sevion positions Eloxx to become a leading rare disease company with sufficient capital to advance its pipeline of first-in-class small molecule therapeutics through significant value-creating events. We plan to initiate multiple clinical studies for ELX-02, our lead development candidate. Importantly, we anticipate achieving substantial clinical milestones over the course of 2017 and 2018 particularly in our lead clinical programs in cystic fibrosis and cystinosis patients carrying non-sense mutations. ELX-02 has shown pharmacological, pharmacodynamic and physiological effects in several animal models of genetic disease cause by non-sense mutations including Cystic Fibrosis (CF), Cystinosis, Duchene Muscular Dystrophy (DMD), Rett syndrome and mucoplysaccharidose type I (MPS I).'