Status Tags:        Clearance; Mitigation; Withdraw and Refiled (2d Time); Interim Order; Withdrawn and Refiled

Acquirer:            Sino Biopharmaceutical Limited (Hong Kong SAR, China)

Acquired:           F-Star Therapeutics, Inc. (United Kingdom; U.S.)

Value:                 $161 million  

Industry Tags:    Pharmaceutical; Biotechnology; Healthcare

On June 22, 2022, “invoX Pharma (“invoX”), a wholly owned subsidiary of Sino Biopharmaceutical Limited (“Sino Biopharm”) (HKEX 1177 HK), focused on research and development (R&D) and business development activities outside of China, and F-star Therapeutics, Inc. (“F-star”) (NASDAQ:FSTX), a clinical-stage biopharmaceutical company pioneering bispecifics in immunotherapy . . . entered into a definitive agreement whereby invoX will acquire all of the issued and outstanding shares of F-star common stock for $7.12 per share. The proposed acquisition values F-star at approximately $161 million.” (Press Release, F-Star Therapeutics, Inc., Form 8-K, Ex-99.1, June 23, 2022, SEC Filing.)  “On July 1, 2022, invoX Pharma and the Company each filed a joint voluntary notice with CFIUS.” (F-Star Therapeutics, Inc., Schedule 14D-9, July 7, 2022, SEC Filing.) 

“Pursuant to a request by CFIUS, on October 31, 2022, the parties voluntarily withdrew and immediately refiled the joint voluntary notification filing (the ‘Notice’) in order to provide CFIUS with more time to complete its assessment. CFIUS’s acceptance of the refiled voluntary Notice is effective as of November 1, 2022.” (F-Star Therapeutics, Inc., Schedule 14D-9, Nov. 1, 2022, SEC Filing.) In a December 19, 2022, SEC filing, F-Star Therapeutics disclosed that “[o]n December 15, 2022, CFIUS advised the parties that it is availing itself of another 45-day investigation period, and that its investigation will be completed by no later than January 30, 2022 [sic], unless extended further.” (F-Star Therapeutics, Inc., Schedule 14D-9, Dec. 19, 2022, SEC Filing.)  In that same SEC filing, F-Star Therapeutics disclosed that CFIUS “identified national security risks arising from the Transactions” and was “continuing to consider whether mitigation measures could adequately resolve the identified risks.”  (Id.)  

On December 20, 2022, the parties amended the CFIUS condition to closing in the agreement, which had required that “CFIUS affirmatively cleared the Transactions,” such that the parties could “complete the Offer no earlier than five (5) business thereafter, subject to CFIUS not notifying the parties that it objects to closing . . .” (F-Star Therapeutics, Inc., Schedule 14D-9, Dec. 21, 2022, SEC Filing.)   “On the evening of December 28, 2022, and prior to the then-scheduled Expiration Date, CFIUS notified [invoX Pharma Limited] that if the Parties intended to proceed with the closing of the transactions contemplated by the Merger Agreement without having resolved CFIUS’s identified national security risks, CFIUS would take action to restrict the Parties from consummating the transactions contemplated by the Merger Agreement.” (F-Star Therapeutics, Inc., Schedule TO/A, Dec. 29, 2022, SEC Filing.) “Effective at December 29, 2022 at 12:05 a.m. Eastern Time, [CFIUS] issued an order (the ‘Interim Order’) preventing the consummation of the transactions pursuant to the Merger Agreement, citing unresolved national security risks.”  (F-Star Therapeutics, Inc., Form 8-K, Dec. 29, 2022, SEC Filing.)   “The purpose of the Interim Order is to provide CFIUS adequate opportunity to continue its review and investigation.” (Id.)

“To afford the Parties additional time to negotiate the terms of a mitigation agreement and continue discussions with CFIUS, on January 30, 2023, the Parties voluntarily withdrew and immediately refiled the voluntary notice at the request of CFIUS. CFIUS’ acceptance of the refiled voluntary notice is effective as of January 31, 2023.”  (F-Star Therapeutics, Inc., Schedule TO/A, Feb. 1, 2023, SEC Filing.)   The parties also agreed to extend “the End Date of the Merger Agreement in order to provide additional time for the Parties to complete negotiations with [CFIUS] on the definitive terms of a mitigation agreement . . .”  (F-Star Therapeutics, Inc., Form 8-K, Feb. 9, 2023, SEC Filing.)  As of March 5, 2023, the Parties were “in the final stages of the approval process for a definitive agreement necessary to remove CFIUS’s Interim Order and allow the transaction to close.”  (F-Star Therapeutics, Inc., Form 8-K, Mar. 6, 2023, SEC Filing.)  On March 7, 2023, F-Star Therapeutics announced that CFIUS “has cleared the previously announced all-cash acquisition of the Company by invoX Pharma Limited.” (Press Release, F-Star Therapeutics, Inc., Form 8-K, Ex-99.1, Mar. 7, 2023, SEC Filing.)

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