Third Harmonic Bio to dissolve, strategic review underway for remaining assets.

Third Harmonic Bio is undergoing a strategic review and considering the dissolution of the company. A plan of dissolution has been proposed, which includes the distribution of assets and intellectual property to stockholders. The company is also exploring agreements or transactions for the sale of its remaining assets and intellectual property, including THB335. The outcome of these efforts is uncertain and may not be successful or on attractive terms.

Third Harmonic Bio, Inc. (Nasdaq: THRD) has received overwhelming stockholder approval for its Plan of Liquidation and Dissolution, as announced in a recent press release [1]. The proposal, which received 99.9% of votes cast and 83.7% of the Company’s total outstanding common shares, outlines the distribution of assets and intellectual property to stockholders. The Company expects to finalize the Plan of Dissolution and make the initial distribution to stockholders in the third quarter of 2025.

The initial distribution is estimated to be between approximately $5.30 and $5.35 per share of common stock, with total distributions estimated between $5.30 and $5.44 per share. These estimates do not include potential cash from the sale of the Company’s remaining assets and intellectual property, including THB335, an oral wild-type KIT inhibitor currently in Phase 1 clinical trials.

The Company recently completed an additional cohort in its Phase 1 clinical trial of THB335, demonstrating promising results. The 100mg once-daily dose showed pharmacokinetics and pharmacodynamics consistent with the 164mg dose level, with an 85% mean reduction from baseline of serum tryptase, a biomarker of mast cell activation. All adverse events were mild, with the exception of one moderate adverse event of neutrophil reduction. The Company has completed all clinical, toxicology, and manufacturing activities to support a Phase 2 clinical trial of THB335 and plans to submit a regulatory filing with the US Food and Drug Administration (FDA) to seek clearance for trial initiation.

As part of the Plan of Dissolution, the Company is initiating a sale process for THB335 and related intellectual property. Interested parties should contact Chris Murphy, Chief Financial and Business Officer, for more information.

The decision to dissolve despite having a Phase 2-ready asset with promising data suggests the company faced strategic headwinds. The challenging funding environment for small-cap biotechs likely influenced this decision, as continuing development would require significant capital. By initiating a sale process for THB335 simultaneously with dissolution, the company is attempting to maximize shareholder value while acknowledging the risks of continuing operations independently.

The overwhelming stockholder approval of Third Harmonic’s liquidation plan signals strong alignment between management and investors on this strategic direction. The initial distribution estimate of $5.30-$5.35 per share expected in Q3 2025 provides shareholders with concrete near-term value, while maintaining potential upside through the THB335 asset sale. The narrow range between the initial distribution and total expected distributions indicates minimal holdback for contingencies, suggesting efficient resolution of obligations is anticipated.

The Company's approach of maintaining asset value through continued development activities while simultaneously pursuing dissolution reflects sophisticated strategic planning. Completing Phase 2 readiness activities and preparing FDA submissions keeps THB335's value intact for potential acquirers, potentially maximizing shareholder returns beyond the base liquidation value. The decision to liquidate while holding promising assets likely stems from a thorough assessment of capital requirements versus realistic future outcomes.

References:
[1] https://www.streetinsider.com/Corporate+News/Third+Harmonic+Bio+%28THRD%29+Announces+Stockholder+Approval+of+Plan+of+Liquidation+and+Dissolution/24928488.html
[2] https://www.stocktitan.net/news/THRD/third-harmonic-bio-announces-stockholder-approval-of-plan-of-n0dm1ba11j9v.html