After a year of financial challenges and struggling to stay alive, San Diego women’s health company Evofem Biosciences is being acquired for approximately $100 million.
Evofem will become a wholly owned subsidiary of publicly traded biotech firm, Aditxt Inc., the companies announced last week. The merger deal provides a lifeline to Evofem after the company offered itself for sale in February.
Evofem’s lead product and source of revenue is Phexxi, an FDA-approved non-hormonal birth control. The vaginal gel is Evofem’s only commercial product and it is the only non-hormonal birth control option on the market approved by the U.S. Food and Drug Administration.
The company launched Phexxi in September 2020, with a big marketing push of celebrity-endorsed ad campaigns and efforts to get the product covered by insurance providers. But after a failed clinical trial in October 2022, Evofem’s stock fell and it was eventually delisted from the Nasdaq.
Earlier this year, Evofem founder and CEO Saundra Pelletier took a 40 percent pay cut, offloaded their Del Mar office and reduced the company’s workforce by 20 percent to preserve cash. She said Evofem has had no money to promote Phexxi this past year.
Most recently in November, Evofem was accused in a letter from the FDA of overstating the efficacy level of Phexxi in preventing pregnancy on a patient brochure.
After taking “so many body blows” Pelletier said she is optimistic this merger with Aditxt will allow Phexxi to grow in markets like college campuses and for people who can’t take hormonal birth control, such as cancer patients.
“It feels like an incredible weight has been lifted,” Pelletier said. “No longer will hope have to be a strategy because we now have the resources and the muscle and the support of a parent entity to help us raise money and find products, because they believe that what we’ve done has mattered.”
Evofem was founded in 2009 and it became a public company through a reverse merger with Neothetics in 2018. The company recorded $13.4 million in net sales for Phexxi in the first nine months of 2023 — a roughly 20 percent decline from the prior year period. Evofem recorded about $55 million net income during the same period this year.
Aditxt, with headquarters in Northern California and Virginia, focuses on developing technologies for immune system health and commercializing novel solutions. The company is valued at about $2 million.
Pelletier said the merger is a good fit for both companies because it reignites Evofem’s ability to innovate and it allows Aditxt to build a women’s health portfolio.
“At Aditxt, our mission is to make promising innovations possible together. Evofem represents precisely the kind of groundbreaking innovation that aligns with our mission,” said Amro Albanna, Aditxt CEO, in a statement. “Aditxt will provide Evofem with a global platform to amplify their transformative innovation in women’s health.”
Aditxt has agreed to buy Evofem in a primarily stock deal including approximately $60 million in preferred stock and the assumption of up to $18 million in debt.
The acquiring company is also loaning Evofem $3 million to cover closing costs of the transaction. The deal is expected to close in the first half of 2024, according to the SEC filing.
Pelletier will remain CEO of Evofem and its 38 employees will join the new company. Evofem will maintain a presence in San Diego, Pelletier said, but it will no longer function as a standalone public company. It will operate under the umbrella of Aditxt Inc., which is traded under the symbol, ADTX, on the Nasdaq Capital Market.
