Pieris Pharmaceuticals (PIRS) Business Combination summary

Deal rationale and strategic fit

• Merger creates a Nasdaq-listed biopharma focused on novel therapies for serious, rare genetic skin diseases with high unmet need and low competition.

• Strategic review identified the merger as the best path to deliver value to stockholders and preserve potential milestone and royalty streams from legacy assets.

• Combined company will prioritize development and commercialization of QTORIN™ 3.9% rapamycin gel for microcystic lymphatic malformations and cutaneous venous malformations.

• Palvella's QTORIN™ platform offers a patented approach to locally treat serious skin diseases driven by mTOR pathway overactivation.

• The transaction allows Palvella to access public markets and accelerate its vision to develop and commercialize therapies for rare skin diseases.

Financial terms and conditions

• Upon closing, the combined company is expected to have approximately $80.5 million in cash, including $78.9 million from an oversubscribed concurrent private financing.

• All-stock transaction; Pieris will issue shares to Palvella stockholders, making Palvella a wholly-owned subsidiary.

• Pre-merger Palvella stockholders will own about 82% and pre-merger Pieris stockholders about 18% of the combined company, subject to adjustments.

• Pieris stockholders will receive contingent value rights (CVRs) tied to future proceeds from legacy partnerships and potential tax credits.

Synergies and expected cost savings

• Combined company will leverage Palvella’s management expertise and capital-efficient operations to advance late-stage clinical programs.

• Merger and financing expected to fund operations through multiple clinical milestones and into the second half of 2027.