Pelthos agrees to merge with Castle Creek Biosciences in biotech combination

Pelthos Therapeutics, a NYSE American-listed dermatology company, and Castle Creek Biosciences, a late-stage developer of redosable gene therapies, have signed a definitive agreement under which Castle Creek will merge with Pelthos. The combined company will operate as Pelthos Therapeutics and keep its NYSE American listing under the PTHS ticker.

Castle Creek stockholders will receive 5,200,000 Pelthos common shares at closing, about 32.5% of Pelthos' fully diluted shares. They may also receive up to 5,800,000 more shares on FDA approval of D-Fi, and up to $300 million in milestone payments, including a $50 million payment on specified Phase 3 endpoints. Closing is expected by the end of the first quarter of 2027, subject to Castle Creek stockholder approval.

Pelthos CEO Scott Plesha said the deal broadens the company beyond cutaneous infectious diseases into serious skin diseases. Castle Creek CEO Matt Gantz said Pelthos would provide commercial infrastructure for D-Fi, a treatment for dystrophic epidermolysis bullosa. Latham & Watkins advised Pelthos, Oppenheimer & Co. gave Pelthos' board a fairness opinion, and Bradley Arant Boult Cummings and Katten Muchin Rosenman advised Castle Creek, with PHCP as its financial adviser.