Sec Form 13D Filing - OrbiMed Israel BioFund GP Limited Partnership filing for 9 METERS BIOPHARMA INC (NMTRQ) - 2020-05-14

 

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

 

SCHEDULE 13D

 

Under the Securities Exchange Act of 1934

 

 

9 Meters Biopharma, Inc.

(Name of Issuer)

 

Common Stock, par value $0.0001 per share

(Title of Class of Securities)

 

45782F105

(CUSIP Number)

 

OrbiMed Israel BioFund GP Limited Partnership

OrbiMed Israel GP Ltd.

 

Nissim Darvish

89 Medinat HaYehudim St.

Building E, 11th Floor

Herzliya 46766, Israel

Telephone: 972 73 2822600

(Name, Address and Telephone Number of Person Authorized
 to Receive Notices and Communications)

 

May 4, 2020

(Date of Event Which Requires Filing of this Statement)

 

If the filing person has previously filed a statement on Schedule 13G to report the acquisition that is the subject of this Schedule 13D, and is filing this schedule because § 240.13d-1(e), 240.13d-1(f) or 240.13d-1(g) check the following box ☐.

 

Note: Schedules filed in paper format shall include a signed original and five copies of the schedule, including all exhibits.  See § 240.13d-7(b) for other parties to whom copies are to be sent.

 

* The remainder of this cover page shall be filled out for a reporting person’s initial filing on this form with respect to the subject class of securities, and for any subsequent amendment containing information which would alter disclosures provided in a prior cover page.

 

 

The information required on the remainder of this cover page shall not be deemed to be “filed” for the purpose of Section 18 of the Securities Exchange Act of 1934 (“Act”) or otherwise subject to the liabilities of that section of the Act but shall be subject to all other provisions of the Act (however, see the Notes).

 

 

SCHEDULE 13D

CUSIP No.  45782F105

Page 2 of 10 Pages

 

1	NAME OF REPORTING PERSONS              OrbiMed Israel BioFund GP Limited Partnership
2	CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (See Instructions) (a) o (b) o
3	SEC USE ONLY
4	SOURCE OF FUNDS (See Instructions)               N/A
5	CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEMS 2(d) or 2(e)			o
6	CITIZENSHIP OR PLACE OF ORGANIZATION   State of Israel
NUMBER OF SHARES BENEFICIALLY OWNED BY EACH REPORTING PERSON WITH		7	SOLE VOTING POWER           0
		8	SHARED VOTING POWER                30,559,521 (1)
		9	SOLE DISPOSITIVE POWER                  0
		10	SHARED DISPOSITIVE POWER                30,559,521 (1)
11	AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON               30,559,521 (1)
12	CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES (See Instructions)			o
13	PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11) 27.3% (2)
14	TYPE OF REPORTING PERSON (See Instructions)              PN

 

(1)	This total consists of:  (i) 16,986,521 shares of common stock, par value $0.0001 per share (the “Shares”) of 9 Meters Biopharma, Inc. (the “Issuer”), (ii) 6,786,500 Shares issuable upon the conversion of 67,865 shares of Series A Convertible Preferred Stock, par value $0.0001 per share of the Issuer, (the “Series A Preferred Stock”) and (iii) 6,786,500 Shares issuable upon the ultimate conversion of warrants to purchase up to 67,865 shares of the Series A Preferred Stock. This amount excludes 1,943,734 Shares that are currently issued in the name of a third party and held in escrow for the purpose of satisfying potential indemnity claims until the six month anniversary of the Merger (as defined in Item 3).
(2)	This percentage is calculated based upon 111,768,076 Shares outstanding, as set forth in the Issuer’s Form 8-K filed with the Securities and Exchange Commission (“SEC”) on May 8, 2020 and giving effect to the additional 13,573,000 Shares that would be outstanding following the conversion of certain shares of Series A Preferred Stock as reported above. This amount includes the 1,943,734 Shares that are currently issued in the name of a third party and held in escrow for the purpose of satisfying potential indemnity claims until the six month anniversary of the Merger (as defined in Item 3).

 

SCHEDULE 13D

 

CUSIP No.  45782F105

Page 3 of 10 Pages

 

1	NAME OF REPORTING PERSONS               OrbiMed Israel GP Ltd.
2	CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (See Instructions) (a) o (b) o
3	SEC USE ONLY
4	SOURCE OF FUNDS (See Instructions)                 N/A
5	CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEMS 2(d) or 2(e)			o
6	CITIZENSHIP OR PLACE OF ORGANIZATION                  State of Israel
NUMBER OF SHARES BENEFICIALLY OWNED BY EACH REPORTING PERSON WITH		7	SOLE VOTING POWER                   0
		8	SHARED VOTING POWER                 30,559,521 (1)
		9	SOLE DISPOSITIVE POWER              0
		10	SHARED DISPOSITIVE POWER                30,559,521 (1)
11	AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON                 30,559,521 (1)
12	CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES (See Instructions)			o
13	PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)                27.3% (2)
14	TYPE OF REPORTING PERSON (See Instructions)                   CO

 

(1)	This total consists of:  (i) 16,986,521 shares of common stock, par value $0.0001 per share (the “Shares”) of 9 Meters Biopharma, Inc. (the “Issuer”), (ii) 6,786,500 Shares issuable upon the conversion of 67,865 shares of Series A Convertible Preferred Stock, par value $0.0001 per share of the Issuer, (the “Series A Preferred Stock”) and (iii) 6,786,500 Shares issuable upon the ultimate conversion of warrants to purchase up to 67,865 shares of the Series A Preferred Stock. This amount excludes 1,943,734 Shares that are currently issued in the name of a third party and held in escrow for the purpose of satisfying potential indemnity claims until the six month anniversary of the Merger (as defined in Item 3).
(2)	This percentage is calculated based upon 111,768,076 Shares outstanding, as set forth in the Issuer’s Form 8-K filed with the Securities and Exchange Commission (“SEC”) on May 8, 2020 and giving effect to the additional 13,573,000 Shares that would be outstanding following the conversion of certain shares of Series A Preferred Stock as reported above. This amount includes the 1,943,734 Shares that are currently issued in the name of a third party and held in escrow for the purpose of satisfying potential indemnity claims until the six month anniversary of the Merger (as defined in Item 3).

 

Item 1.

Security and Issuer.

 

This Schedule 13D relates to the common stock, par value $0.0001 per share (the “Shares”), of 9 Meters Biopharma, Inc., a corporation organized under the laws of Delaware (the “Issuer”), with its principal executive offices located at 8480 Honeycutt Road, Suite 120, Raleigh, North Carolina 27615.  The Shares are listed on the NASDAQ Capital Market under the ticker symbol “NMTR.” Information given in response to each item shall be deemed incorporated by reference in all other items, as applicable.

 

Item 2.

Identity and Background.

 

(a)                  This Statement is being jointly filed by OrbiMed Israel GP Ltd., an Israeli company (“OrbiMed Israel”), and OrbiMed Israel BioFund GP Limited Partnership, an Israeli limited partnership (“OrbiMed BioFund”) (together, the “Reporting Persons” and each, a “Reporting Person”).

 

(b) – (c)          OrbiMed Israel, a company that acts as general partner of certain limited partnerships, is the general partner of OrbiMed BioFund, which is the general partner of OrbiMed Israel Partners Limited Partnership, an Israeli limited partnership (“OIP”), which holds the securities to which this Statement relates.

 

The address of the principal office of each Reporting Person is 89 Medinat HaYehudim St., Build E, 11th Floor, Herzliya 46766 Israel.

 

The name, business address, present principal occupation or employment and citizenship of each of the directors, executive officers and partners (as applicable) of the Reporting Persons are set forth in Schedules I and II hereto and are incorporated herein by reference.

 

(d) – (e)          During the last five years, none of the Reporting Persons nor, to the best of their knowledge, any of the persons listed in Schedules I and II hereto, has been: (i) convicted in a criminal proceeding (excluding traffic violations or similar misdemeanors) or (ii) a party to a civil proceeding of a judicial or administrative body of competent jurisdiction and as a result of such proceeding was or is subject to a judgment, decree or final order enjoining future violations of, or prohibiting or mandating activities subject to, federal or state securities laws or finding any violation with respect to such laws.

  

Item 3.

Source and Amount of Funds or Other Consideration.

 

Prior to the Merger (as defined below), OIP was a stockholder of RDD Pharma Ltd., a company organized under the laws of Israel (“RDD”). On April 30, 2020, the Issuer, previously named Innovate Biopharmaceuticals, Inc., consummated its merger with RDD, in accordance with the terms of an Agreement and Plan of Merger and Reorganization (the “Merger Agreement”), dated as of October 6, 2019, as amended on December 17, 2019, between the Issuer, RDD, INNT Merger Sub 1 Ltd., a company organized under the laws of Israel and a directly, wholly-owned subsidiary of the Issuer (“INNT Merger Sub”), and OIP, as the Shareholder Representative. Pursuant to the Merger Agreement, INNT Merger Sub was merged with and into RDD (the “Merger”), with RDD continuing as the surviving corporation and a direct wholly-owned subsidiary of the Issuer. Under the terms of the Merger Agreement, the Issuer issued Shares to former RDD stockholders, including 16,986,521 Shares to OIP. An additional 1,943,734 Shares that may be issued to OIP are currently issued in the name of a third party and held in escrow for the purpose of satisfying potential indemnity claims until the six month anniversary of the Merger.

 

In addition, on April 29, 2020, OIP entered into a securities purchase agreement with the Issuer pursuant to which the Issuer agreed to issue and sell to OIP (i) 67,865 shares of Series A Convertible Preferred Stock (the “Series A Preferred Stock”), which are convertible into 6,786,500 Shares (the “Conversion Shares”) and (ii) 67,865 five-year warrants (the “Warrants”) to purchase 67,865 shares of Series A Preferred Stock (the “Conversion Warrant Shares”), which are convertible into 6,786,500 Shares (the “Financing Transactions”). The Financing Transactions closed on May 4, 2020.

 

The source of funds for such purchases was the working capital of OIP.

 

As a result of the Merger and the Financing Transactions, OrbiMed Israel, as the general partner of OrbiMed BioFund, and OrbiMed BioFund as the general partner of OIP, may each be deemed to be the beneficial owner of 27.3% of the outstanding Shares.

 

Item 4.

Purpose of Transaction.

 

The Shares have been acquired by the Reporting Persons for the purpose of making an investment in the Issuer and not for the intention of acquiring control of the Issuer’s business on behalf of OIP.

 

The Reporting Persons from time to time intend to review their investment in the Issuer on the basis of various factors, including the Issuer’s business, financial condition, results of operations and prospects, general economic and industry conditions, the securities markets in general and those for the Issuer’s Shares in particular, as well as other developments and other investment opportunities.  Based upon su ch review, the Reporting Persons will take such actions in the future as the Reporting Persons may deem appropriate in light of the circumstances existing from time to time.  If the Reporting Persons believe that further investment in the Issuer is attractive, whether because of the market price of the Shares or otherwise, they may acquire Shares or other securities of the Issuer either in the open market or in privately negotiated transactions. Similarly, depending on market and other factors, the Reporting Persons may determine to dispose of some or all of the Shares currently owned by the Reporting Persons or otherwise acquired by the Reporting Persons either in the open market or in privately negotiated transactions.

 

Except as set forth in this Statement, the Reporting Persons have not formulated any plans or proposals which relate to or would result in: (a) the acquisition by any person of additional securities of the Issuer or the disposition of securities of the Issuer; (b) an extraordinary corporate transaction, such as a merger, reorganization or liquidation, involving the Issuer or any of its subsidiaries; (c) a sale or transfer of a material amount of the assets of the Issuer or any of its subsidiaries; (d) any change in the present Board or management of the Issuer, including any plans or proposals to change the number or term of directors or to fill any existing vacancies on the Board; (e) any material change in the Issuer’s capitalization or dividend policy; (f) any other material change in the Issuer’s business or corporate structure: (g) any change in the Issuer’s charter or bylaws or other or instrument corresponding thereto or other action which may impede the acquisition of control of the Issuer by any person; (h) causing a class of the Issuer’s securities to be deregistered or delisted from a national securities exchange or to cease to be authorized to be quoted in an inter-dealer quotation system of  a national securities association; (i) a class of equity securities of the Issuer becoming eligible for termination of registration pursuant to Section 12(g)(4) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”); or (j) any action similar to any of those enumerated above.

 

Item 5.

Interest in Securities of the Issuer.

 

(a)-(b)          As of the date of this filing, the Reporting Persons may be deemed, for purposes of Rule 13d-3 of the Exchange Act, directly or indirectly, including by reason of their mutual affiliation, to be the beneficial owners of the Shares described in Item 6 below.  Based upon information contained in the Issuer’s Form 8-K filed with the Securities and Exchange Commission on May 8, 2020, such Shares constitute approximately 27.3% of the issued and outstanding Shares. OrbiMed Israel, pursuant to its authority as the general partner of OrbiMed BioFund, the general partner of OIP, may be deemed to indirectly beneficially own the Shares held by OIP.  OrbiMed BioFund, pursuant to its authority as the general partner of OIP, may be deemed to indirectly beneficially own the Shares held by OIP.  As a result, OrbiMed Israel and OrbiMed BioFund and OIP share the power to direct the vote and to direct the disposition of the shares of Shares described in Item 6 below.

 

(c)          Except as disclosed in Item 3, the Reporting Persons have not effected any transactions during the past sixty (60) days in any Shares.

 

(d)          Not applicable.

 

(e)          Not applicable.

 

Item 6.

Contracts, Arrangements, Understandings or Relationships with Respect to Securities of the Issuer.

 

In addition to the relationships between the Reporting Persons described in Items 2, 3, and 5 above, OrbiMed BioFund is the general partner of OIP pursuant to the terms of the limited partnership agreement of OIP.  OrbiMed Israel is the general partner of OrbiMed BioFund, pursuant to the terms of the limited partnership agreement of OrbiMed BioFund.  As a result, OrbiMed BioFund has the power to direct the vote and to direct the disposition of the Shares held by OIP and such power is exercised through OrbiMed Israel. OrbiMed Israel exercises this investment power through an investment committee (the “Committee”) comprised of Carl L. Gordon, Jonathan T. Silverstein, Nissim Darvish (“Darvish”), Anat Naschitz and Erez Chimovits, each of whom disclaims beneficial ownership of the Shares held by OIP, except to the extent of their pecuniary interest therein. As a result, OrbiMed BioFund and OrbiMed Israel may be deemed directly or indirectly, including by reason of their mutual affiliation, to be the beneficial owners of the Shares held by OIP and to share power to direct the vote and the disposition of the Shares held by OIP.  The number of outstanding Shares attributable to OIP is 30,559,521 Shares, which amount includes the Conversion Shares and the Conversion Warrant Shares. OrbiMed Israel maybe be considered to hold indirectly 30,559,521 Shares, and OrbiMed BioFund may be considered to hold indirectly 30,559,521 Shares, which amount includes the Conversion Shares and the Conversion Warrant Shares.

 

The Reporting Persons designated Darvish to serve as a member of the Board of Directors of the Issuer, and, accordingly, the Reporting Persons may have the ability to affect and influence control of the Issuer. From time to time, Darvish may receive stock options or other awards of equity based compensation pursuant to the Issuer’s compensation arrangements for non-employee directors. Darvish is obligated to transfer any Shares issued under any such stock options or other awards, or the economic benefit thereof, to OrbiMed Israel or an affiliate, which will in turn ensure that such Shares or economic benefits are provided to OIP.

 

Registration Rights Agreement

 

In connection with the Financing Transactions, OIP and certain other stockholders of the Issuer entered into a Registration Rights Agreement (the “Registration Rights Agreement”), dated April 29, 2020 with the Issuer. Pursuant to the Registration Rights Agreement and subject to the terms and conditions therein, the parties agreed that, no later than thirty (30) days following the closing of the Merger, the Issuer shall prepare and file with the Securities and Exchange Commission a registration statement covering the resale of all of the Conversion Shares and Conversion Warrant Shares (the “Registrable Securities”). In addition, for long as the Registrable Securities remain outstanding, promptly following the date upon which the Issuer becomes eligible to use a registration statement on Form S-3 to register the Registrable Securities for resale, but in no event more than thirty (30) days after such date, the Issuer shall file a registration statement on Form S-3 covering all of the Registrable Securities (or a post-effective amendment on Form S-3 to a registration statement on Form S-1) (a “Shelf Registration Statement”) and shall use commercially reasonable efforts to cause such Shelf Registration Statement to be declared effective as promptly as practicable thereafter.

 

Except as described above or elsewhere in this Statement or incorporated by reference in this Statement, there are no contracts, arrangements, understandings or relationships (legal or otherwise) between any of the Reporting Persons or, to the best of their knowledge, any of the persons named in Schedules I and II to this Statement or between any of the Reporting Persons and any other person or, to the best of their knowledge, any person named in Schedules I and II to this Statement and any other person with respect to any securities of the Issuer, including, but not limited to, transfer or voting of any securities, finder’s fees, joint ventures, loan or option arrangements, puts or calls, guarantees of profits, division of profits or losses, or the giving or withholding of proxies.

 

 

 

 

 

          

Item 7.

Materials to be Filed as Exhibits.

 

Exhibit No.	Description
1.	Joint Filing Agreement between OrbiMed Israel GP Ltd. and OrbiMed Israel BioFund GP Limited Partnership.
2.	Registration Rights Agreement by and among the Issuer and each of the persons listed on the signature page thereto, dated as of April 29, 2020 (incorporated by reference to Exhibit 10.2 to the Issuer’s Form 8-K (SEC 001-37797), filed with the SEC on May 4, 2020.

 

 

 

 

 

 

 

 

 

SIGNATURE

 

After reasonable inquiry and to the best of each of the undersigned’s knowledge and belief, each of the undersigned certifies that the information set forth in this statement is true, complete and correct.

 

Dated:  May 14, 2020

                   

	ORBIMED ISRAEL BIOFUND GP LIMITED PARTNERSHIP
	By:	OrbiMed Israel GP Ltd., its General Partner
	By:	/s/ Nissim Darvish
		Nissim Darvish
		Director
	ORBIMED ISRAEL GP LTD.
	By:	/s/ Nissim Darvish
		Nissim Darvish
		Director

 

 

 

 

 

 

 

SCHEDULE I

 

The name and present principal occupation of each of the executive officers and directors of OrbiMed Israel GP Ltd. are set forth below.  Unless otherwise noted, all of these persons are Israeli citizens and have as their business address 89 Medinat HaYehudim St., Build E, 11th Floor, Herzliya 46766, Israel.

 

 

Name	Position with Reporting Person	Principal Occupation
Carl L. Gordon American citizen	Director	Member OrbiMed Advisors LLC 601 Lexington Avenue, 54th Floor New York, NY 10022
Nissim Darvish	Director	Senior Managing Director OrbiMed Israel Partners Limited
Jonathan T. Silverstein American citizen	Director	Member OrbiMed Advisors LLC 601 Lexington Avenue, 54th Floor New York, NY 10022
Erez Chimovits	Director	Partner OrbiMed Israel Partners Limited
Anat Naschitz	Director	Managing Director OrbiMed Israel Partners Limited

 

 

 

 

 

 

 

 

SCHEDULE II

 

 

The business and operations of OrbiMed Israel BioFund GP Limited Partnership are managed by the executive officers and directors of its general partner, OrbiMed Israel GP Ltd.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Exhibit Index

 

Exhibit No.	Description
1.	Joint Filing Agreement between OrbiMed Israel GP Ltd. and OrbiMed Israel BioFund GP Limited Partnership.
2.	Registration Rights Agreement by and among the Issuer and each of the persons listed on the signature page thereto, dated as of April 29, 2020 (incorporated by reference to Exhibit 10.2 to the Issuer’s Form 8-K (SEC 001-37797), filed with the SEC on May 4, 2020.