Ritter Pharmaceuticals & Qualigen Announce Merger Agreement

Ritter Pharmaceuticals, Inc. recently reported it has entered into a definitive reverse merger agreement with Qualigen, Inc. as well as expansion of its flagship FastPack diagnostic platform, whereby a wholly owned subsidiary of the company will merge with and into Qualigen in an all-stock transaction with Qualigen.

Upon completion of the merger, the company will change its name to Qualigen, Inc., or a similar name selected by Qualigen. The merged company will focus on the development of Qualigen’s nanotechnology therapies for the treatment of cancer and infectious diseases, while also continuing to operate its profitable diagnostic business. Under a separate Contingent Value Right (CVR) agreement, a CVR holder representative will continue to seek opportunities to monetize Ritter Pharmaceuticals’ RP-G28 asset with financial support from Qualigen for a defined period, with the net proceeds of any monetization to be distributed to Ritter Pharmaceuticals’ pre-merger stockholders. In conjunction with the merger transaction, Qualigen has arranged the securing of additional capital from an institutional investor (the Pre-Closing Financing) to support funding of its operations and expansion of its clinical development programs.

“The time is right for us to take advantage of our core science and regulatory experience from our diagnostic business and expand into promising cancer therapeutic drugs and devices,” said Michael S. Poirier, President, Chief Executive Officer and Chairman of Qualigen. “With this transaction and our key knowledge in cancer and infectious disease, we look forward to progressing our clinical development programs.”

“Following a rigorous evaluation and diligence process, our Board of Directors has concluded that a merger with Qualigen offers an excellent opportunity to create meaningful value for our stockholders,” said Andrew J. Ritter, Ritter Pharmaceuticals’ President and Chief Executive Officer. “We believe this transaction has the potential to continue our mission to help patients and allows us to continue to seek opportunities to commercialize RP-G28, our therapeutic treatment for lactose intolerance.”

On a pro forma basis and based on the number of shares of Ritter Pharmaceuticals common stock to be issued in the merger, the pre-merger Ritter Pharmaceuticals stockholders will own approximately 7.5% of the post-merger combined company and the pre-merger Qualigen stockholders will own approximately 92.5% of the post-merger combined company on a fully-diluted basis, assuming Qualigen raises the minimum amount of additional capital from the institutional investor in the Pre-Closing Financing and the combined company meets Nasdaq listing requirements. The transaction has been approved by the board of directors of both companies.

The merger is expected to close in the second quarter of 2020, subject to the approval of the stockholders of each company, as well as other closing conditions, including among other things, the Registration Statement for the merger shares to be issued being declared effective by the Securities and Exchange Commission, the Company’s common stock to be issued in the merger being approved for listing on Nasdaq, the consummation of the Pre-Closing Financing, and Ritter Pharmaceuticals stockholders’ equity being no less than $0.00 as of immediately prior to the merger. The Merger Agreement may be terminated by the parties under certain circumstances including, among others, by Qualigen if the Company is unable to maintain its listing on Nasdaq up until the Effective Time of the merger.

In addition, Ritter Pharmaceuticals stockholders of record as of immediately prior to the Effective Time of the merger will receive non-transferable CVRs entitling the holders to receive the net proceeds, if any, from any sale, license, transfer, spin-off or other monetizing event of all or any part of the company’s current business or all or any part of the company’s intellectual property or technology which is entered into during the period beginning on the date the merger agreement was signed and ending on the third anniversary of the closing date of the merger.

A.G.P./Alliance Global Partners is acting as financial advisor to the Company for the transaction and GreenBlock Capital is acting as financial advisor to Qualigen for the transaction. Reed Smith LLP is serving as legal counsel to the Company and Stradling Yocca Carlson & Rauth is serving as legal counsel to Qualigen.

Following the merger, Michael S. Poirier, President, Chief Executive Officer and Chairman of Qualigen will be appointed to serve as the post-merger combined company’s chairman, president and chief executive officer. The board of directors for the post-merger combined company will be comprised of seven directors, including one member from Ritter Pharmaceuticals’ legacy board of directors. Members of the Ritter Pharmaceuticals executive team are expected to support Qualigen’s transition into therapeutic clinical development and the public markets under separate consulting agreements.

Qualigen, Inc. (www.qualigeninc.com) is a biotechnology company focused on developing novel therapeutics for the treatment of cancer and infectious diseases, using similar core nanoparticle coating technology from its FDA-approved FastPack System, which has been used successfully in diagnostics for over 15 years. The company’s cancer therapeutics pipeline includes ALAN (AS1411-GNP), RAS-F3 and STARS. ALAN (AS1411-GNP) is a DNA coated gold nanoparticle cancer drug candidate that has the potential to target virtually any cancer type with minimal side effects. RAS-F3 is a small molecule RAS oncogene protein-protein inhibitor for blocking RAS mutations that lead to tumor formation, especially in pancreatic, colorectal and lung cancers. STARS is a DNA/RNA-based treatment device for removal from circulating blood of precisely targeted tumor-produced and viral compounds. Its facility in Carlsbad, California, is FDA and ISO Certified and its FastPack product line is sold worldwide by its commercial partner, Sekisui Diagnostics, LLC.

Ritter Pharmaceuticals, Inc. (www.RitterPharma.com, @RitterPharma) develops innovative therapeutic products that modulate the gut microbiome to treat gastrointestinal diseases. The Company is exploring the therapeutic potential that gut microbiome changes may have on treating/preventing a variety of diseases including gastrointestinal diseases, cancer, metabolic, and liver disease.