The Cross-Border Biotech Blog

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

Monday Deal Review: March 25, 2013

Welcome to your Monday Biotech Deal Review for March 25, 2013! This week’s big news was Valeant’s ongoing strategy of using acquisitions to bolster their product portfolio rather than R&D.  Valeant is paying US$19.75 per share of Obagi, which is a skin-care company that is thought to be a leader in the physician dispensed market. Following last year’s acquisition of skin-care maker Medicis, this acquisition is hoped to save $40 million a year for Valeant in cost synergies with tspectralhe new company. Analysts have said that Valeant is paying a little higher than the 2-2.5 times multiple of sales that Valeant has shown a preference to pay, although the cost synergies may be a likely explanation of that.

In other news, IMRIS and Cynapsus have closed private placements, while Trimel has continued their plan of a private placement in conjunction with their major shareholder Eugene Melnyk. Hit the break to catch up on all of the week’s major biotech news!

M & Eh

Valeant Pharmaceuticals International, Inc. (NYSE: VRX, TSX: VRX) has entered into a definitive agreement under which Valeant will acquire all of the outstanding common stock of Obagi Medical Products, Inc. (NASDAQ: OMPI) for $19.75 per share in cash, which represents a 28% premium to Obagi’s closing share price on March 19, 2013, the last trading day prior to announcement. The transaction is expected to close in the first half of 2013 and Valeant expects the transaction, once completed, to be immediately accretive to Valeant’s cash earnings per share. The combination is expected to yield cost synergies at an annual run rate of at least $40 million within six months of closing.

Investment

IMRIS Inc. (NASDAQ: IMRS; TSX: IM) has closed its underwritten public offering of 5,750,000 common shares at a public offering price of US$3.50 per share. The gross proceeds to IMRIS, before underwriting commissions and other offering expenses, were approximately US$20.1 million.

Spectral Diagnostics Inc. (TSX: SDI) has increased the size of its previously announced private placement to an aggregate $5.6 million, comprised of a total of 18,666,667 common shares in the capital of the company, at a price of $0.30 per common share. In addition to the previously announced 16,666,667 common shares to be sold to Toray Industries, Inc. at a price of $0.30 per common share for $5 million from Toray, the company has agreed to sell a further 2,000,000 common shares to other subscribers at a price of $0.30 per common share, for additional proceeds of $600,000.

Lignol Energy Corporation (TSXV: LEC) has invested approximately A$2.5 million to acquire approximately 356 million shares of Australian Renewable Fuels Limited (ASX: ARW) as a part of ARW’s underwritten rights issue of approximately A$8 million. This investment was funded, in part, from LEC’s recently announced line of credit with one of the Company’s major shareholders, Difference Capital Funding Inc.  This investment  together with the approximately 179 million shares acquired by LEC as a part of ARW’s share placement, announced on February 12, 2013, and shares previously acquired by LEC has resulted in a total ownership of approximately 898 million shares, representing 21.4% of ARW.

Cynapsus Therapeutics Inc. (TSXV: CTH) has completed a second closing of its short form prospectus offering of units for gross proceeds of $1,309,160. On March 1, 2013, the company completed a first closing of the offering for gross proceeds of $6,008,000. Total gross proceeds from the first closing and the second closing of the offering are equal to $7,317,160. Pursuant to the second closing, the company issued an aggregate of 2,846,000 units at a post-consolidation price of $0.46 per unit raising gross proceeds of $1,309,160. Each unit consists of one common share in the capital of the company and one common share purchase warrant of the company. Each warrant, whether issued on the date of the first closing or the date of the second closing, will entitle the holder to purchase one common share at a price equal to $0.575 each for a period of 60 months after the date of the first closing, except, that the warrants will be cancelled if they are not exercised within 30 days after prior written notice from the company that the closing price of its common shares on the principal stock exchange of the company has been three times the offering price for 20 consecutive trading days.

Trimel Pharmaceuticals Corporation (TSX: TRL) has filed a preliminary short form prospectus in connection with a proposed marketed offering of units, with each unit consisting of one common share of the company and one-half of one common share purchase warrant. The common shares forming a part of the units will be comprised of a combination of common shares issued by the company and common shares sold by Mr. Eugene Melnyk. The warrants forming a part of the units will all be warrants issued by the company. Mr. Melnyk will receive the net proceeds from the sale of his share. The company will receive the net proceeds from the sale of the company issued shares and the warrants.

Debt Financing

Medifocus Inc.  (TSX-V:MFS) has completed the share for debt transaction originally announced January 29, 2013. The company issued today an aggregate of 1,090,000 common shares at a deemed price of $0.25 per common share to settle an aggregate of $272,500 of debt representing unpaid salary ($210,000) and amounts due to service providers ($62,500).

Angiotech Pharmaceuticals, Inc. (TSX:ANP)   announced that Deutsche Bank National Trust Company , issued a notice of redemption on behalf of Angiotech under the indenture to redeem $16,000,000 in aggregate principal amount of Angiotech’s Senior Secured Floating Rate Notes due 2013.  The redemption price for the notes is equal to 100% of principal amount of the notes, together with accrued and unpaid interest on the principal amount of the notes to, but excluding, the redemption date, which is April 17, 2013.  As of the date hereof, there are approximately $60 million in aggregate principal amount of notes outstanding.

Commercial and Other Agreements

Trimel Pharmaceuticals Corporation (TSX: TRL) announced that. Trimel Biopharma SRL, a wholly-owned subsidiary of Trimel, has entered into an agreement to partner with a privately-held European company to develop single dose and fixed dose combinations of a portfolio of established active pharmaceutical ingredients for the treatment of a variety of respiratory disorders utilizing Trimel SRL’s award-winning inhalation technology, called TriVair™. As part of this transaction, Trimel SRL will gain rights to all know-how and intellectual property developed for the applicable products for territories outside of the European Union, Russia and Ukraine. Trimel SRL’s development partner will be granted rights to the products developed under the agreement in these markets. Royalties will be payable by the parties to each other in connection with revenues received by each party (or any licensees) in their respective territories in connection with any developed products developed under the agreement.

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s

Follow

Get every new post delivered to your Inbox.

Join 131 other followers