Medical technology firm Cognos Therapeutics has signed a definitive business combination agreement with Nocturne Acquisition to be publicly traded on the Nasdaq Stock Exchange.

Under the all-stock agreement, the shareholders of Cognos will receive a total of $120m of Nocturne common stock, with each share valued at $10.30 for the deal.

Both companies’ boards of directors unanimously approved the transaction, which is subject to the approval of stockholders as well as other standard closing conditions.

Cognos is focused on developing radically advanced devices to treat neurological diseases, including spinal and brain cancers, epilepsy, and stroke, as well as degenerative neurological conditions, such as Parkinson’s disease and Alzheimer’s.

The deal is anticipated to conclude in the second or third quarter of the year.

The company’s next-generation drug delivery system, the SINNAIS Implantable Smart Pump, has been designed to deliver drugs to targeted tissues, bypassing the blood-brain barrier.

The system can also deliver drugs to other tissues with fewer off-target side effects.

The company expects the deal to allow it to expedite the research and development process for its proprietary drug delivery pump, which is designed to improve outcomes for brain cancer and other neurological diseases treatment.

Cognos CEO Frank Addell said: “With this agreement, Cognos will be able to have broad access to the capital markets. This will enable us to raise the capital to complete the next phases of our product development for the SINNAIS Implantable Pump.

“This includes further product R&D and clinical testing as well as both our FDA and CMS regulatory review as we work to gain 510k and PMA approval for our technology.”

The company is currently working on the preliminary development of a skull-mounted optical sensor.

This sensor is an implantable shunt that collects key parameters from the disease target site and transmits the data to a cloud-based infrastructure for analysis.