Welcome to your Monday Biotech Deal Review for July 9, 2012. Highlights from the previous two weeks include the announcement of a $13.25 million prospectus offering by Trimel Pharmaceuticals, and the announcement of a $200 million exchange offer by Angiotech on its Senior Floating Rate Notes due 2013. Read on to learn more.
Trimel Pharmaceuticals Corporation (TSX: TRL) announced terms of a $13.25 million equity financing, in connection with a public offering by short-form prospectus (announced here). Trimel entered into an underwriting agreement with a syndicate of underwriters led by RBC Dominion Securities Inc. and including GMP Securities L.P. to sell 7,569,000 units of the company at a price of $1.75 per unit for aggregate gross proceeds of $13,245,750. Each unit consists of one common share and one half of one common share purchase warrant. Each whole warrant will entitle the holder to purchase one common share at an exercise price of $2.50 until the date which is 30 months after closing of the offering. In contrast to the initial announcement, all of the units will be offered by the company and there will no longer be a secondary offering as previously announced.
Pivotal Therapeutics (CNSX: PVO) entered into a subscription agreement with Crossover Healthcare Fund LLC and intends to close a non-brokered private placement for CDN $5 million. Pursuant to the agreement, Pivotal has agreed to issue 22,727,273 units at a price of $0.22 each. Each unit consists of one common share and one-half purchase warrant. Each full purchase warrant may be exercised to purchase one common share upon payment of the exercise price of $0.50 per common share. The purchase warrants will expire 24-months following the closing of the private placement and may be called at any time after six months following closing, provided the common shares of Pivotal have traded at a price of at least $0.75 for 20 trading days within a 30 consecutive day trading period.
Microbix Biosystems Inc. (TSX: MBX) announced the closing of a private placement financing resulting in the issuance of 1,806,332 units at a price of $0.30 per unit for gross proceeds of $541,900. Each unit consists of one common share of Microbix and one common share purchase warrant. Each whole warrant entitles the holder to purchase one additional common share at an exercise price of $0.33 for 24 months. One Insider of MicroBix participated by purchasing an aggregate 500,000 units. The financing was non- brokered.
CardioComm Solutions, Inc. (TSXV: EKG) has closed its previously announced non-brokered private placement equity financing. The company issued 200,000 units at a price of $0.60 per unit, for gross proceeds of $120,000. Each unit was comprised of one common share and one common share purchase warrant exercisable for two years for an additional share at a price of $0.85. The shares and warrants are subject to a four-month hold period, which expires on October 30, 2012.
BIOREM Inc. (TSXV: BRM) has announced a proposed private placement of up to 1,500 units at a price of $1,000 per unit for gross proceeds of up to $1.5 million. Each unit will consist of $1,000 principal amount of 8.00% convertible extendible secured subordinated debentures with a maturity date 2 years from the date of issuance and 4,545 common share purchase warrants. The debentures will be convertible into fully paid and non-assessable common shares at the option of the holder any time over their term at a price of $0.11 per share. The maturity date of the debentures can be extended to the fifth anniversary date of the issuance date of the Debentures by holders of 66.67% of the then outstanding principal amount of debentures. The debentures can be prepaid in full at any time by the company upon giving holders 15 days notice of prepayment. Each warrant entitles the holder to purchase one common share at a price of $0.11 per share for a period of two (2) years from issuance.
iCo Therapeutics Inc. (TSXV: ICO) announced that its agent, Euro Pacific Canada Inc., has carried out a overnight marketed offering, announced July 4, 2012, and confirmed $2,553,899.40 in demand for equity units, representing 5,675,332 units at a price of $0.45 per unit. Each unit includes one common share plus one common share purchase warrant. Each warrant is exercisable at a price of $0.60 for a period of 2 years from the closing of the offering. Euro Pacific will be paid a cash commission of 8% on gross proceeds plus 8% compensation options, which are exercisable on the same terms as the units in the offering. The offering will be effected in British Columbia, Alberta and Ontario by way of a prospectus supplement. Prior to the offering, iCo had 46,644,401 common shares issued and outstanding.
BioExx Specialty Proteins Ltd. (TSX: BXI) has closed its previously announced $6.4 million debt financing through Romspen Investment Corporation. Proceeds of this loan are being distributed in accordance with agreed closing procedures, repaying in priority the Company’s existing debt facility with Farm Credit Canada in the amount of approximately $4 million, with the balance to be available for working capital and general corporate purposes.
Warnex Inc. (TSXV: WNX) has announced the refinancing of its operations with its principal shareholder, Persistance Capital Partners LP (PCP), assuming the role of the company’s main lender replacing its existing credit facility with Accord Financial Inc. This new facility with PCP permits a maximum availability of $1,250,000 bearing interest at the rate of 19.75%, subject to a minimum annual interest payment guarantee of $185,000. Warnex has determined that the terms of this new credit facility are commensurate with those available from arm’s length lenders.
Medifocus Inc. (TSXV: MFS) has announced an agreement with Boston Scientific Corporation (NYSE: BSX) for the purchase of all of the assets of its Prolieve® business, which sells devices for the treatment of Benign Prostatic Hyperplasia. The total purchase price for the transaction is US$5 million. Medifocus will pay Boston Scientific Corporation US$2.5 million upon closing of the transaction and the remainder will be paid in quarterly instalments contingent upon the sales performance of the Prolieve business, up to a maximum of US$2.5 million. Closing of the transaction is expected to occur within 30-days subject to certain conditions.
Paladin Labs Inc. (TSX: PLB) has announced the completion of a transaction relating to a strategic partnership with the Litha Healthcare Group, as previously announced here. All of the conditions for the transaction have been fulfilled and the transaction will take effect from Monday, July 2, 2012. The transaction involves a strategic partnership whereby Paladin will accelerate its buy-out of the remaining 55.01% of Pharmaplan Limited and merge the Pharmaplan business with the pharma division of Litha Healthcare Group (JSE: LHG).
Licensing and Distribution Agreements
ProMetic Life Sciences Inc. (TSX: PLI) has received a $4.6 million purchase order under its ongoing supply agreement with Octapharma. Shipments to Octapharma in relation to this order are expected to exceed $2.0 million during the second half of 2012. The latest order relates to the purchase of PrioClear™, a proprietary prion capture resin incorporated into Octapharma’s manufacturing process for its solvent/detergent treated plasma product.
PharmaGap Inc. (TSXV: GAP) announced that its Independent Committee has received from Bloom, Burton & Co. a Fairness Opinion regarding the proposed license of its lead cancer drug program to Clinical Value Corporation (CVC). Based on this, the Independent Committee has recommended that the company proceed with implementation of the transaction. CVC is a wholly-owned subsidiary of SC Stormont Holdings Inc., which in turn is owned and controlled by the Chairman of PharmaGap Inc. Shareholders other than Stormont will vote on the transaction by proxy or by attendance at PharmaGap’s Annual General Meeting to be held on August 3, 2012.
Other Corporate or Commercial Developments
Annidis Corporation (TSXV: RHA) has obtained approval from the TSX Venture Exchange to amend certain stock options granted to directors, officers, employees and consultants between July 8, 2008 and September 22, 2009. A total of 3,525,000 stock options that were to expire between July 8, 2012 and September 22, 2012 at exercises prices between $0.32 and $0.36 will be extended by four additional years with the exercise price increased to $0.40 per share. Annidis has also announced that it has granted an aggregate of 50,000 options to employees and consultants which entitle the holder to acquire one Annidis common share at an exercise price of $0.40 with an expiry on June 27, 2016.
MedMira Inc. (TSXV: MIR) has been awarded a U.S. Army Medical Research Acquisition Activity (USAMRAA) contract to develop and commercialize a rapid test capable of simultaneous detection of HIV and Hepatitis B and C. The contract, awarded through a competitive bid process, involves a two-year base period and a 10-month option with a value of USD$4,266,144, if all options are exercised. Under the contract, the U.S. Army will fund all development costs and associated fees in obtaining a U.S. Food and Drug Administration premarket approval for the test.
Angiotech Pharmaceuticals Inc. (TSX: ANP) has commenced an offer to exchange up to $200 million in aggregate principal amount of its Senior Floating Rate Notes, due 2013, for new 9% Senior Notes due 2016 to be issued by Angiotech Pharmaceuticals (U.S.) Inc. In conjunction with the offer, Angiotech is also soliciting consents from the holders of the existing notes to certain proposed amendments that would provide that the new and existing notes would vote together as a single class on certain matters. Holders that validly tender (and do not withdraw) their existing notes and deliver their consents prior to 11:59 PM, New York City time, on July 17, 2012 will be entitled to receive new notes with a principal amount constituting a 2.0% premium to the principal amount of the existing notes so exchanged.
Special thanks to Jennifer Ng for help with this week’s Monday Biotech Deal Review!