Israeli ingestible medical devices company Epitomee Medical (TASE: EPIT) notified the Tel Aviv Stock Exchange (TASE) this morning that its planned marketing partner Nestlé has announced that the clinical trial results of its weight loss pill, did not meet the targets set out in the agreement between them. Epitomee's share price fell 71% today, wiping NIS 310 million off the company's market cap.
Epitomee has developed a pill that swells in the stomach, creates a sense of satiation and then disintegrates. The company, formerly called Tulip Medical, was founded in 2005 by Doron Marco and Shimon Eckhouse, the founder of Lumenis and Syneron. Eckhouse serves as both chairman and is an active investor. The company's CEO is Dan Hashimshony. The company had a valuation of NIS 800 million at its IPO in December 2021, and today less than two years later it is worth only NIS 126 million.
In September, Epitomee published the results of its clinical trial, which it presented as a success and saw its share price jump. The results met the basic targets of the trial as defined by the company, which is striving to obtain US FDA approval, which it expects to receive in 2024.
Nestlé was going to have exclusive marketing rights to the product and when interviewed by "Globes" a senior executive in Nestlé's slimming division expressed enthusiasm for the pill and said that Nestlé was preparing to fulfill the agreement.
But now Epitomee says it has been unofficially told by Nestlé that after examining the trial results, they did not meet the full minimal terms set in the licensing agreement.
Epitomee reported that these are terms that were in the agreement, which are not related to the main end-points of the trial and are not defined in a rigid and clear way, and it was not possible to know in advance how Nestlé would treat them.
Published by Globes, Israel business news - en.globes.co.il - on November 29, 2023.
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