The Cross-Border Biotech Blog

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

Monday Deal Review: March 4, 2013

Welcome to your Monday Biotech Deal Review for March 4, 2013! The highlights from the past week include Oncolytics’ closing of their$32 million public offering, an update on Paladin’s ongoing share purchase program, and Atrium’s joint venture agreement with Fosum.  Get the details on these and the rest of the week’s major biotech news by clicking through.

Investment

Oncolytics Biotech Inc. (TSX: ONC) (NASDAQ:ONCY) has closed its previously announced underwritten public offering of 8.0 million common shares, at a public offering price of US$4.00 per common share.  The aggregate gross proceeds from the offering, before deducting underwriting discounts and commissions and offering expenses payable by Oncolytics, were approximately US$32.0 million.

Paladin Labs Inc. (TSX:PLB)  has announced that it has received regulatory approval from the Toronto Stock Exchange to carry out a normal course issuer bid. Paladin has been authorized to purchase up to 906,669 of its common shares, or approximately 10% of its public float of 9,066,691 common shares as at February 15, 2013, in the twelve-month period following the bid’s effective date. During the past 12 months, Paladin purchased 58,716 common shares at a weighted average price of $38.79 pursuant to a normal course issuer bid. Paladin also announced that it will enter into an automatic share purchase plan with a broker in order to facilitate repurchases of its common shares under its normal course issuer bid.

Immunovaccine Inc. (TSXV: IMV) has provided update for the private placement of its securities which is scheduled to close this week (previously covered here). Terms of the previously announced private placement have been modified such that investors will receive one common share at a price of $0.33. The private placement will be for up to 6,060,606 common shares and the total amount raised will be up to $2 million. As previously announced, Immunovaccine has a lead order as well as commitments for participation from directors of IMV.

Debt Financing

Lignol Energy Corporation (TSXV: LEC) has announced that the company has entered into a secured credit facility for up to $5 million with Difference Capital Funding Inc, a major shareholder of LEC.  Amounts drawn under this facility will bear interest at 8% per annum and the facility will mature on the earlier of February 27, 2014 or upon the completion of an equity financing raising gross proceeds of at least $5 million. These funds will initially be secured by a general security agreement providing for a security interest in all of LEC’s present and future personal property until such time as DCF has a perfected security interest in all of the shares of Australian Renewable Fuels Limited (ASX: ARW) owned by LEC pursuant to a share pledge agreement. Once DCF’s security interest in the ARW shares has been perfected, the general security agreement will be terminated.

Commercial Agreements and Other Announcements

The Centre for Commercialization of Regenerative Medicine (CCRM) has added Sernova Corp. (TSXV: SVA) to its member-based industry consortium. Sernova’s combination of immuno-protective technology and therapeutic cells for the treatment of chronic diseases advances CCRM’s goal of developing innovative cell-based product.

Med BioGene Inc. (TSX-V:MBI) today provided an update in regard to its ongoing litigation with Signal Genetics LLC and Respira Health LLC. In February 2011, Signal and Respira filed a lawsuit against MBI and its commercial partner, Precision Therapeutics, Inc., in the Supreme Court of the State of New York asserting twelve causes of action against MBI. MBI continues to believe that the lawsuit is frivolous, vexatious and entirely without merit and is defending the lawsuit vigorously. MBI has received financial support from Precision to, among other things, conduct such defense (half of which is credited against future royalties that may be owed to MBI by Precision) and to cover any settlement or award of damages made against MBI, subject in all cases to certain threshold limits.

Atrium Innovations Inc. (TSX: ATB)  has announced that it has entered into a joint venture contract with Fosun Industrial, incorporated in Hong Kong, wholly owned of Shanghai-based Fosun Pharma for the purposes of distributing Atrium brands in China. According to IMS Health Incorporated, Fosun Pharma is one of the top five domestic pharmaceutical companies in the People’s Republic of China, by revenue, in the pharmaceutical manufacturing segment. The new joint venture will operate under the FOSIUM Innovations name.

Akela Pharma, Inc. (TSX:AKL) has announced that its wholly owned subsidiary, Formulation Technologies, LLC received a notice of default and that on February 13, 2013, the subsidiary also received a Notice of Disposition of Collateral on Default from a secured creditor. Over the past several months, the Corporation, Biotech and a senior secured creditor of the Corporation had been negotiating a transaction in an attempt to reach an acceptable settlement of the default claims of the Corporation’s senior secured creditors and for the funding of future operations.  While several agreements by and amongst the Parties were executed in January 2013, the Parties were ultimately unable to reach an agreement on all the issues and the intended results of the negotiations failed to materialize.

 

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