The Cross-Border Biotech Blog

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

Monday Deal Review: January 7, 2013

Happy New Year and welcome to your Monday Biotech Deal Review for January 7, 2013! While biotech gets back to business for 2013 after the holidays, the last 2 weeks have not seen a flurry of activity.  Nonetheless, on the M&A side, IBEX Technologies acquired Bio-Research Products, while Biosign and Patheon completed private financings of their own.  Further, Warnex has begun trading under the NEX and Stellar Pharmaceuiticals has completed their planned name change to Tribute Pharmaceuitcals.  Get more details on these stories as well as last week’s other major biotech news by clicking through.  

M&Eh

IBEX Technologies Inc. (TSXV:IBT) has announced that it has acquired Bio-Research Products Inc. (BRP), an Iowa-based maker of specialized reagents. BRP specializes in the production of enzymes, lectins, protease inhibitors, organics, substrates and assay solutions for diagnostic, industrial and research use. Manufacturing is conducted in 10,000 sq. ft. facility with fermentation capability up to 300L. The shareholders of BRP will receive US$2,000,000 in cash and future earn out to a maximum of US$700,000). IBEX funded the acquisition from its cash reserves, but expects to obtain a mortgage of approximately US$1,000,000 on BRP’s land and buildings, for a net IBEX outlay of US$1,000,000 in cash for the acquisition. IBEX expects that the acquisition will have no impact on its fiscal 2013 earnings, but should be accretive in fiscal 2014.

Investment

Biosign Technologies Inc. (TSXV: BIO)  has closed a private placement for 4,000,000 units of the company at a purchase price of $0.05 per unit, which forms part of its recently announced private placement financing.  Each unit is comprised of one common share and one common share purchase warrant. Each common share purchase warrant is exercisable for a 2-year period at $0.05 per share during the first 12 months and $0.10 per share in the second twelve months. Additionally, the company has accepted a subscription for an additional 6,000,000 units, with the same terms and conditions, from the same investor. The second 6,000,000 unit private placement is scheduled to close as to $50,000 on January 8, 2013, $150,000 on January 14, 2013 and $100,000 on February 14, 2013.

Patheon Inc. (TSX: PTI) announced the completion of its subscription rights offering, which expired on December 28, 2012. The rights offering was fully subscribed for with gross proceeds totaling approximately U.S. $30 million. Patheon issued 9,403,483 restricted voting shares as a result of the rights offering. This issuance represents approximately 7.2% of the company’s restricted voting shares issued and outstanding prior to the rights offering.  Upon the issuance of these new restricted voting shares, the company will have 139,701,375 restricted voting shares outstanding. An affiliate of JLL Partners Fund V, L.P., a related party of the company, exercised its subscription rights in full, including its over-subscription privilege, up to the full amount of the rights offering. The subscription payments in the aggregate amount of was used to partially finance its acquisition of Sobel USA Inc. and Banner Pharmacaps Europe B.V.

Licensing and Commercial Agreements

Abattis Bioceuticals Corp.  (CNSX:FLU) has announced that the company has entered into an amended license agreement which amends the terms of the license agreement previously entered into between Abattis and Vertical Designs Ltd. Under the amended license agreement, Abattis has now been granted the exclusive, worldwide rights to a patent license, with the right to grant sublicenses, to use the Bio-Pharma technology for growing products at licensed facilities, which products may only be used as ingredients in the pharmaceutical, neutraceutical, cosmetic and wellness markets, for total consideration of $600,000 to be paid by way of the issuance of 6,000,000 common shares of Abattis ($250,000, or 2,500,000 common shares of Abattis, of which was previously paid to Vertical Designs on execution of the original agreement).

Bioniche Life Sciences Inc. (TSX: BNC) announced that Endo Pharmaceuticals (a subsidiary of Endo Health Solutions) and Bioniche have agreed that a mutually favourable path forward is to return the global rights relating to Urocidin™ back to Bioniche. As detailed in the companies’ termination agreement, in exchange for this agreement, Endo will receive a 5% royalty on future net sales revenue for a term of 10 years from the first commercial sale of the product or, on a country by country basis, until the last of the valid patent claims covering the product has expired or been invalidated.

Corporate Announcements

Stellar Pharmaceuticals Inc. (OTC: SLXCF)(PINK:TBUFF) has announced it has changed the company’s name to Tribute Pharmaceuticals Canada Inc. and it has been assigned a new ticker (PINK:TBUFF).

Warnex Inc. (TSXV: WNX) (NEX:WNX.H) has announced that effective December 27, 2012, its common shares will begin trading on the NEX on a post one-for-four share consolidation basis under the symbol WNX.H.

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