Pelthos Therapeutics Inc. (NYSE American: PTHS) announced on October 30, 2026, that it has entered into a definitive Agreement and Plan of Merger with Castle Creek Biosciences, Inc. Under the terms of the agreement, Pelthos will acquire Castle Creek through a two-step merger process. Castle Creek stockholders will receive 5,200,000 shares of Pelthos common stock at closing, which represents approximately 32.5% of Pelthos' fully diluted shares.
In addition to the initial stock consideration, Castle Creek stockholders are eligible to receive additional payments contingent on the development and commercial success of Castle Creek’s lead candidate, D-Fi. These include up to 5,800,000 shares of Pelthos common stock if the U.S. Food and Drug Administration (FDA) approves D-Fi on or before March 31, 2036. The agreement also outlines a total of $300 million in milestone payments, including a $50 million payment upon achievement of specified clinical endpoints and additional payments tied to the first commercial sale and net sales milestones of D-Fi. Furthermore, Castle Creek stockholders are entitled to 80% of the net proceeds from the sale of any priority review voucher granted by the FDA for D-Fi.
D-Fi (dabocemagene autoficel) is an injectable, redosable gene-modified cell therapy currently in Phase 3 development for dystrophic epidermolysis bullosa (DEB), a rare genetic skin disorder. The therapy has received Orphan Drug Designation from the FDA. Upon closing of the transaction, Pelthos intends to increase its board of directors from eight to ten members, adding two directors designated by Castle Creek. Scott Plesha, CEO of Pelthos, will continue in his role, while Peter Greenleaf will serve as Executive Chair of the combined company.
The transaction is expected to close by the end of the first quarter of 2027, subject to customary closing conditions, including approval by the stockholders of both companies and the expiration of the Hart-Scott-Rodino Antitrust waiting period.
