Monday Biotech Deal Review: January 25, 2010

Everyone’s looking to the future in this week’s deal review: two special committees, 225,000 options, two royalty streams, a delisting notice and the first income trust/tax loss deal of 2010. 

M&A

ConjuChem Biotechnologies, Inc. (TSX: CJB) established an independent committee of Directors to evaluate strategic alternatives, including a possible sale.  Stay tuned.

The Chairman and CEO of Dragon Pharmaceutical Inc. (TSX: DDD) has made an offer to acquire all of the shares of the company.  Mr. Yanlin Han, who is also the largest shareholder of the company (owning 37.5%) made the offer at a price of $0.80 per share. The shares closed at $0.63 on the TSX on January 22, 2010. No announcement or recommendation yet from the company.

Securities

Sonomax Hearing Healthcare Inc. (TSXV: SHH) is hopping on the income trust tax loss deal bandwagon, planning to raise $1.74 million through a plan of arrangement with Benvest New Look Income Fund (TSX: BCI.UN), a Québec-based income trust.  The announcement left the company’s share price unmoved and didn’t drive unusual volume.  Maybe now that ConjuChem, Vasogen and SemBioSys paved the way, the market is truly viewing these as neutral.

Æterna Zentaris Inc. (NASDAQ:  AEZS) (TSX: AEZ) received a NASDAQ notice that because its share price has been under $1.00 for 30 days, it has fallen out of compliance with the exchange’s minimum listing requirements.  The company has 180 days to regain compliance.

IntelGenx Technologies Corp. (TSXV: IGX) granted 50,000 options to its Canadian investor relations firm SectorSpeak Inc. The 3-year, $0.50 options vest in equal parts at the 1- and 2-year marks.

Kane Biotech Inc. (TSXV: KNE) granted 175,000 options to its President and CEO, with an exercise price of $0.15 and a 5-year best-by date.

Licensing and Commercial Deals

SemBioSys Genetics Inc. (TSX: SBS) had the first product developed using its platform technology gain FDA approval this week.  SemBioSys’ partner Arcadia Biosciences Inc. gained approval to market and sell SONOVA™ 400 as an ingredient in dietary supplements.  The product is a gamma linolenic acid-rich safflower oil. Sales will result in a royalty stream for SemBioSys, with commercial quantities expected to be ready for sale this quarter.

BioSyent Inc. (TSXV: RX), via its subsidiary BioSyent Pharma Inc., signed an exclusive license and distribution agreement with Notlers for BioSyent Pharma to manufacture, market and distribute aerosol sanitizer Virsani™ in the U.S. and Canada.  Financial terms were not disclosed.

Thanks again to Jacob Cawker for help with this week’s Deal Review!