The Cross-Border Biotech Blog

Biotechnology, Health and Business in Canada, the United States and Worldwide

Monday Biotech Deal Review: December 5, 2011

Welcome to your Monday Biotech Deal Review for December 5, 2011.  Some equity investment activity occurred over the previous week, with Resverlogix closing its previously announced $17.5M private placement, Response Biomedical announcing an $8M rights offering, and various other small private placements.  As well, Valeant is going to fund its acquisition of iNova with debt, as summarized further below.  Read on to learn more. 

Investment

Resverlogix Corp. (TSX: RVX) has closed its previously announced $17.5 million private placement to non-Canadian subscribers  of 14,819,476 ($1.18) common shares (covered here).  The major subscribers disclosed were Eastern Capital Limited (13,200,000 common shares) and NGN BioMed Opportunity II, LP (1,619,476 common shares).

Response Biomedical Corporation (TSX: RMB) has announced an $8 million rights offering, the proceeds of which will be used for product development, market expansion, operating losses, capital improvements, working capital and other general corporate purposes. Each shareholder of record will be entitled to receive one right for each common share held.  Each right will be exercisable for 2.7532 units comprising of one common share and one (5-year, $0.0746) warrant at $0.0746 per unit. In connection with the offering, Response has entered into a $5 million standby purchase agreement with OrbiMed Private Investments III, LP, OrbiMed Asia Partners, LP, and OrbiMed Associates III, LP.

PharmaGap Inc. (TSXV: GAP) has completed the conditional closing of a $700,000 private offering of 10,000,000 equity units, subject to approval from the TSX-V. A total of 971,428 ($0.07) units have been subscribed in this conditional closing for proceeds of $68,000.  Each unit is comprised of one common share and one (3-year, $0.10) warrant. $4,080 in cash finder’s fees will be paid in connection with this closing.

biOasis Technologies Inc. (TSXV: BTI) has closed its previously announced $1,157,374 private placement, issuing 2,571,942 ($0.45) units (covered here). Each unit is comprised of one common share and one (2-year) warrant. The warrants are exercisable at $0.70 for the first year and at $0.60 for the second. Finder’s fees of $75,268 were paid in connection with the closing.

Pacific Therapeutics Ltd. (CNSX: PT) has announced a $50,000 non-brokered private placement of up to 357,142 ($0.14) common shares, expected to close within the next 45 days. The placement is the first draw down of funds under the irrevocable subscription agreements that the company entered into with subscribers on January 31, 2011 and May 16, 2011.

M&Eh

Stellar Pharmaceuticals Inc. (OTCQB:SLXCF, PINK:SLXCF) and Tribute Pharmaceuticals announced that Stellar has acquired 100% of the shares of Tribute Pharmaceuticals Canada Ltd. and Tribute Pharma Canada Inc.  Tribute’s shareholders will be paid 13,000,000 common shares of Stellar, $1,000,000 on closing and $500,000 on December 1, 2012.  In addition, upon attainment of certain milestones, Tribute shareholders will also be entitled to an additional 2,000,000 common shares as future consideration.

Debt Financing

Warnex Inc. (TSX: WNX) has closed the previously announced transactions to: (i) extend the maturity date of its convertible debentures that matured on November 8, 2011 to January 31, 2012 and modify the interest rate from 12% to 18% beginning as of November 8; (ii) obtain $600,000 in new financing through the issuance of a new 18% convertible debenture that matures on February 29, 2012 and (3-year) warrants to acquire up to 7,500,000 common shares; and (iii) amend a credit support agreement.

Valeant Pharmaceuticals International, Inc. (NYSE: VRX, TSX: VRX) announced plans to syndicate $350 million of incremental term loans under its existing senior secured credit facilities to partially fund its previously announced acquisition of iNova (covered here). The loans will mature in April 2016 and are expected to have terms consistent with Valeant’s existing $1.725 billion Term Loan A facility.

Licensing and Other Commercial Developments

Exciton Technologies Inc. has signed an exclusive agreement with Medical Mart for the exclusive distribution in Canada of Exciton’s exsalt™ SD7 Wound Dressing, indicated for partial and full thickness wounds.

BELLUS Health Inc. (TSX: BLU) announced that it has signed an exclusive license and distribution agreement with Integris Pharma Ltd., a wholly owned subsidiary of Coronis Research S.A., whereby Integris has secured the exclusive right to market and sell the patented natural health product VIVIMIND™ in Greece and Cyprus.  Integris Pharma Ltd. intends to proceed with filing for regulatory approval and expects to launch VIVIMIND™ in Greece and Cyprus in the second quarter of 2012.

Special thanks to Keldeagh Lindsay for help with this week’s Monday Biotech Deal Review!

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