In Law360, Zach Blume and Will Michener Discussed Biotech Reverse Merger Growth Factors and Driving Forces

In a Law360 article, capital markets partners Zach Blume and Will Michener discussed the growing popularity of reverse mergers as a way for biotech companies to go public.

Reverse mergers allow private companies to go public by taking over a publicly traded company. They offer an alternative pathway to the public markets to traditional initial public offerings (IPOs).

Zach, who advised Rallybio Corp. in two reverse merger processes this year, explained that fundraising has in recent years been a bottleneck for a lot of companies looking to do a reverse merger. An issue was getting investors to invest sufficient funds into a PIPE, or Private Investment in Public Equity, that is a private infusion of cash that is often coupled with reverse merger deals. But as the markets have improved, investors have become more willing to invest in PIPEs.

Will advised publicly traded Cyclerion Therapeutics in its reverse merger with Korsana this year. He noted that markets are now conducive to fundraising in a variety of ways, which has led to the rise of reverse mergers, but the IPO market also remains strong.