Cycle Group Holdings Acquires Applied Therapeutics: Rare Disease Portfolio Gets Major Boost

Cycle Group Holdings Ltd., a privately held biopharmaceutical company, has agreed to acquire Applied Therapeutics Inc. (APLT), a clinical-stage firm specializing in rare metabolic disease treatments. The transaction values the company at $0.088 per share in cash, with the deal expected to finalize in the first quarter of 2026.

The Core Asset: Govorestat’s Mechanism

At the heart of this acquisition sits Govorestat, Applied’s lead candidate—a central nervous system penetrant aldose reductase inhibitor designed to address metabolic dysfunction in rare genetic conditions. The compound targets three major indications: Classic Galactosemia, Charcot-Marie-Tooth Sorbitol Dehydrogenase Deficiency (CMT-SORD), and phosphomannomutase 2 congenital disorder of glycosylation (PMM2-CDG). By inhibiting the aldose reductase enzyme pathway, Govorestat aims to reduce sorbitol accumulation and mitigate neurological damage in these devastating conditions.

Deal Structure: Base Offer Plus Performance Incentives

The acquisition includes a layered contingent value right (CVR) framework that ties shareholder returns to regulatory and commercial success. Under this structure, CVR holders stand to receive:

• $0.10 upon FDA approval of Govorestat for galactosemia treatment
• $0.10 for FDA approval in the CMT-SORD indication
• Up to $0.20 upon reaching $200 million in annual worldwide net sales during any fourth-quarter fiscal period
• Pro rata share of Applied’s excess cash (capped at $1.5 million maximum, applicable only beyond the $500,000 threshold)

To sustain operations through closing, Cycle has already extended an $8.5 million unsecured promissory note to Applied, signaling confidence in the transaction timeline.

Strategic Rationale and Portfolio Impact

Cycle Pharmaceuticals, established in 2012 and based in Cambridge, UK, operates across metabolic, immunology, urology, oncology, and neurology rare disease segments. This acquisition strengthens its existing pipeline and positions Govorestat as a cornerstone program with multiple near-term regulatory catalysts. Applied’s board unanimously approved the transaction following a comprehensive strategic review of alternatives.

Market Reaction and Context

APLT’s shares have fluctuated between $0.20 and $1.50 over its trading history. The stock closed the previous trading session at $0.21 (down 1.41%) before declining sharply to $0.14 in after-hours trading, representing a 34.53% overnight drop—reflecting the modest valuation and underlying uncertainty around Govorestat’s clinical pathway.

The deal closure remains contingent upon customary conditions, including acceptance of the tender offer by a majority of Applied’s shareholders. Without Cycle’s capital infusion, Applied indicated it lacked sufficient runway to sustain operations.