Monday Deal Review: August 17, 2009

In addition to the highlights already noted — Enobia’s $50 million r0und, and the LOM – BioQuest joint venture — there was plenty of other Canadian deal activity this week.  Check it out

M&A:

• IMBiotechnologies Ltd, a private biotechnology company based in Edmonton, purchased assets related to the Occlusin® tumor starvation technology from Paladin Labs (TSE: PLB).  Paladin gets a cash payment for the purchase (undisclosed amount), a one-time milestone payment on first sale of product and a royalty with a capped payment.
• Pacgen Biopharmaceuticals Corporation (TSX-V: PGA) closed its acquisition of Xphase Pharmaceuticals Inc. following TSX-V approval. As agreed, Pacgen issued 3 million common shares to Xphase shareholders in exchange for 100% ownership of Xphase as well as the management services of certain Xphase principals. An additional 3.5 million shares may be payable for business development milestones.

Securities:

• BioSyntech, Inc. (TSX: BSY) appointed Ms. Jeanne Bertonis, MBA, M.Sc. as their new CEO this week and  announced plans to raise $4.5 million through a private placement, debenture extension and rights offering.  Laurentian Bank Securities Inc. is acting as sole financial advisor for the whole triple-play, which should be done by October.  Here’s the scoop:
  • The private placement is for 140,000 units, at $10 per unit, each unit being $10 principal amount of 12% subordinated secured convertible debentures due March 31, 2010 (convertible at $0.11 per share) and ninety-one 7-year $0.14 warrants for gross proceeds of $1,400,000;
  • The current subordinated secured convertible debentures of BioSyntech will be extended to March 31, 2010; and
  • BioSyntech will launch the rights offering, following completion of the private placement and the term extension, for an additional 310,000 units at a price of $10 per unit, representing gross aggregate proceeds of up to $3,100,000, for which the company has a stand-by commitment of $1,958,900 (with an additioal $1.1 million stand-by possibly pending).
• Oncothyreon Inc. (Nasdaq: ONTY, TSX: ONY) placed approximately 2.28 million units (common share plus 0.30 of a 24-month $6.5775 warrant) at $6.5775 per unit for gross proceeds of approximately $15.0 million.  Quite a boost over their deal in May that was $2.85 per unit.
• Jennerex, Inc. announced the first closing of a private placement financing with gross proceeds of US $5,123,521, exceeding the target of $5 million USD. A second closing is anticipated on or before September 15, 2009, with additional proceeds to be determined.
• GeneNews Limited (TSX: GEN) closed the second tranche of its private placement, raising an additional $300,000 over July’s first tranche of $1.7 million.
• Pyng Medical Corp. (TSX-V: PYT) closed the first tranche of its non-brokered private placement of secured subordinated convertible notes  and common share purchase warrants for gross proceeds of $547,725.  The notes are 5-year notes with a conversion price of $0.20 per share and for every $0.20 principal amount of  notes purchased, subscribers received one 5-year $0.22 warrant.  Pyng Growth LLC purchased $400,000 of the offering.  L.J. Evans, Jr. is a shareholder of Pyng Growth and a director of Pyng.
• MedMira Inc., (NASDAQ: MMIRF, TSX-V: MIR) is planning to settle a total of $966,087 of debt by issuing 14,862,880 common shares ($0.065 per share), subject to TSX-V approval.  This is just a half cent a share less than their last round of debt settlement in June.
• Medicure Inc. (TSX: MPH) reached an agreement with its lender to further defer a required payment of approximately US$1.7M to September 1st, 2009 while the parties continue discussions.
• Prism Medical Ltd. (TSX-V: PM), which makes home medical equipment and provides services, granted 3-year options to acquire 50,000 common shares to a senior officer of Prism Medical UK at an option price of $6.00.

Licensing:

Clinical Data, Inc. (NASDAQ: CLDA) announced a collaboration and licensing agreement with CombinatoRx (NASDAQ: CRXX).  Clinical Data is licensing its adenosine A2A agonist, ATL313, to CombinatoRx in exchange for the potential earnings of up to $252 million from milestones and royalties (this In Vivo Blog DoTW post extracts details from the 8-K). CombinatoRx, fresh off the Neuromed transaction, will be responsible for the preclinical and clinical development of ATL313.

Distributor:

Warnex Medical Laboratories, a division of Warnex Inc. (TSX: WNX) and Rosetta Genomics, Ltd. (NASDAQ: ROSG), a developer of microRNA-based molecular diagnostics, announced an exclusive distribution agreement in Canada for three currently-available diagnostic tests for tumor characterization.  Warnex will market Rosetta Genomics’ miRview™ tests. Samples will be sent from Canada to Rosetta Genomics’ Philadelphia-based CLIA-certified laboratory for analysis.

Follow-Up:

• LAB Research Inc. (TSX: LRI) filed the final prospectus for the $15.6 million rights offering they launched last week.
• ConjuChem Biotechnologies Inc.’s (TSX: CJB) plan of arrangement with Colabor Income Fund (TSX: CLB.UN) that was announced last month is scheduled for a final order August 24th.  ConjuChem shares are still down about 10% since the announcement.
• JLL Partners extended its offer for Patheon again, while Patheon announced a regulatory approval.