Sec Form 13D Filing - DONG-A ST CO. LTD filing for MetaVia Inc. (MTVA) - 2021-03-11

Names of Reporting Persons

(S.S. or I.R.S. Identification No. of Above Person)

Dong-A ST Co., Ltd. 

Check the Appropriate Box If a Member of a Group (See Instructions)

a.  ¨

b.  x 

SEC Use Only

Source of Funds:

OO

Check if Disclosure of Legal Proceedings Is Required Pursuant to Items 2(d) or 2(e): ¨

Citizenship or Place of Organization

Republic of Korea

Number of

Shares

Beneficially

Owned By

Each

Reporting

Person

With

Sole Voting Power

2,880,612 

Shared Voting Power

0 

Sole Dispositive Power

2,880,612 

Shared Dispositive Power

0 

Aggregate Amount Beneficially Owned by Each Reporting Person

2,880,612 

Check Box If the Aggregate Amount in Row (11) Excludes Certain Shares (See Instructions)  ¨

Percent of Class Represented By Amount in Row (11)

13.0% 

Type of Reporting Person (See Instructions)

CO 

(a)           This Schedule 13D is being filed by the following person (the “Reporting Person”):

(i)           Dong-A ST Co., Ltd., a corporation organized under the laws of the Republic of Korea.

Schedule I to this Schedule 13D, with respect to the Reporting Person, sets forth a list of all of the directors and executive officers or persons holding equivalent positions (the “Scheduled Persons”) of the Reporting Person.

(b)           The address of the principal business office of the Reporting Person is 64, Cheonho-daero, Dongdaemun-gu, Seoul, Republic of Korea. Schedule I sets forth the principal business address of each Scheduled Person.

(c)           The Reporting Person is in the business of the development and commercialization of pharmaceutical products. Schedule I sets forth the principal occupation or employment of each Scheduled Person.

(d)           The Reporting Person was convicted on August 2017 by Busan Dongbu District Prosecutors' Office of providing rebates to healthcare professionals in exchange for the promotion of sales of certain pharmaceutical products, in violation of the Korean Pharmaceutical Affairs Act. The Reporting Person has not otherwise been convicted in a criminal proceeding (excluding traffic violations or similar misdemeanors) during the last five years.

During the last five years, the Scheduled Persons have not been convicted in a criminal proceeding (excluding traffic violations or similar misdemeanors).

(e)           During the past five years, neither the Reporting Person nor the Schedules Persons have been a party to a civil proceeding of a judicial or administrative body of competent jurisdiction and, as a result of such proceeding, were or are 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.

(f)           The Reporting Person is a South Korean corporation. Schedule I sets forth the citizenships of each of the Scheduled Persons.

Source and Amount of Funds and Other Consideration.

On January 2018, NeuroBo Pharmaceuticals, Inc., a Delaware corporation (“Private NeuroBo”), entered into an exclusive license agreement with the Reporting Person for an exclusive, royalty-bearing, worldwide (except for the Republic of Korea) license to make, use, offer to sell, sell and import products covered by certain intellectual property rights of the Reporting Person in its proprietary compound designated as DA-9801 (NB-01). In connection with obtaining the license, Private NeuroBo paid the Reporting Person total consideration of $2.3 million consisting of a one-time upfront license fee and shares of Private NeuroBo common stock.

On January 18, 2018, Private NeuroBo entered into an asset acquisition agreement (the "Acquisition Agreement"), as amended, with the Reporting Person for NB-02 for the treatment of neurodegenerative disorders. Under the terms of the Acquisition Agreement, Private NeuroBo has the rights to file an investigational new drug application, to conduct further clinical trials, and then produce, commercialize, and sell pharmaceuticals world-wide using NB-02. Private NeuroBo paid total consideration in cash and shares of Private NeuroBo common stock of $6.5 million in consideration for this compound.

On December 30, 2019, Private NeuroBo and GR Merger Sub, Inc., a Delaware corporation and a wholly owned subsidiary of Gemphire Therapeutics Inc. (“Gemphire”), merged with and into Private NeuroBo, with Private NeuroBo continuing as a wholly-owned subsidiary of Gemphire and the surviving corporation of the merger (the “Merger”).

Immediately prior the closing of the Merger, the Reporting Person was a stockholder of Private NeuroBo. Pursuant to the Merger, the capital stock of Private NeuroBo previously held by the Reporting Person was converted into an aggregate of 2,880,612 shares of Common Stock.

The foregoing summary of the Voting Agreement does not purport to be a complete description of the terms and conditions of such agreement, and such description is qualified in its entirety by reference to the full text of the Voting Agreement, a copy of which is attached hereto as Exhibit 1, and is incorporated herein by reference.

The Reporting Person intends, together with E&H and as contemplated by the Voting Agreement, to nominate a slate of directors to be elected to the Board at the Issuer’s 2021 Annual Meeting and 2022 Annual Meeting and propose the declassification of the Board. The Reporting Person may take any other action legally permitted in furtherance of these goals. To accomplish these goals, the Reporting Person intends to seek the proxy of a legally sufficient number of shares of Common Stock to take the proposed corporate actions.

According to the Issuer’s public filing, the Board consists of seven directors, three of whom are serving terms that will expire at the 2021 Annual Meeting, and two of whom are serving terms that will expire at the 2022 Annual Meeting. If individuals nominated by the Stockholders to stand for election as directors at the 2021 Annual Meeting and/or the 2022 Annual Meeting (the “Stockholders’ Nominees”) are elected to the Board, the Stockholders’ Nominees will have substantial influence on Board decisions, including decisions regarding management of the Issuer, the Issuer’s development opportunities, and any offer by the Reporting Person to contribute the DA Products to the Issuer pursuant to the Voting Agreement. Because a majority of the Board are to be elected at the 2021 and 2022 Annual Meetings, the Reporting Person believes that the 2021 and 2022 Annual Meetings present the Issuer’s shareholders with an important opportunity to ensure that the Issuer capitalizes on the value of its development opportunities while properly identifying and managing the risks associated with those ventures.

It is anticipated that the 2021 Annual Meeting will be held on or about June 18, 2021, and the deadline for giving the Issuer notice of director nominations is March 20, 2021. The Reporting Person cautions the Board not to take any steps to eliminate the Issuer’s shareholders’ opportunity to elect three of the seven members of the Board at the 2021 Annual Meeting, and to elect a majority of the Board at both the 2021 and 2022 Annual Meetings, and the Reporting Person further warns the Board that if any such steps are taken the Reporting Person will seek to hold the Board to account.

Additionally, as contemplated by the Voting Agreement, the Reporting Person intends to make a proposal to the Issuer, prior to the 2022 Annual Meeting, to contribute the DA Products to the Issuer. The proposed consideration in exchange for such contribution of DA Products may be shares of Common Stock, which could result in a change in control of the Issuer in the event that such proposed transaction is consummated.

(a)           The Reporting Person beneficially owns 2,880,612 shares of Common Stock. The ownership percentage is 13.0% (based upon 22,171,182 shares issued and outstanding, including (x) the 19,671,182 shares of Common Stock issued and outstanding as of January 14, 2021 as reported in the Issuer’s Preliminary Proxy Statement on Schedule 14A, filed with the SEC on February 2, 2021 and (y) the 2,500,000 shares of Common Stock issued on January 21, 2021 as reported in the Issuer’s Current Report on Form 8-K, filed with the SEC on January 21, 2021).

By virtue of the Voting Agreement, E&H II, E&H 6 and E&H 7 may be deemed to be members of a “group” with the Reporting Person. None of E&H II, E&H 6 or E&H 7 are reporting persons on this Schedule 13D, and any obligations they may have under Section 13(d) of the Act would have to be satisfied on one or more separate filings. To the extent that the Reporting Person may be deemed to beneficially own any shares of Common Stock held by E&H II, E&H 6 and E&H 7, the Reporting Person expressly disclaims, to the extent permitted by applicable law, beneficial ownership thereof.

(c)          Other than as reported in Item 4, the Reporting Person has not effected any transactions in the Shares during the past sixty (60) days.

(d)          Not applicable.

(e)          Not applicable.

DONG-A ST CO., LTD.

Outside Director of Dong-A ST

Professor at College of Business School, Kyung Hee University (26, Kyungheedae-ro, Dongdaemun-gu, Seoul, Republic of Korea)

Outside Director of Dong-A ST

Advisor of Yulchon LLC (521, Teheran-ro, Gangnam-gu, Seoul, Republic of Korea)

Outside Director of Dong-A ST

Professor at College of Pharmacy, Ewha Womans University (52, Ewhayeodae-gil, Seodaemun-gu, Seoul, Republic of Korea)

Outside Director of Dong-A ST

Administrative Agent at and Representative of PA-Partners Joint Administrative Office