The Cross-Border Biotech Blog

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

Monday Deal Review: December 16, 2013

  Welcome to your Monday Biotech Deal Review for December 16, 2013! This week saw Cangene announce thier acqusition by Emergent BioSolutions for CDN$236 million. Further, on the commercial side, Theratechnologies, Stellar Biotechnologies and NEOMED all made announcements in the collaboration space.

Hit the break to see this week’s major biotech news.

M&Eh

Cangene Corporation (“Cangene”) (TSX: CNJ) announced the signing of a definitive agreement under which Emergent BioSolutions (“Emergent”) of Rockville, Maryland will acquire Cangene in an all-cash transaction valued at US$222 million (approximately C$236 million). Under the terms of the agreement, which has been approved by the Boards of Directors of both companies, Cangene shareholders will receive US$3.24 per share (C$3.44 per share) in cash. The purchase price represents a premium of approximately 27% to Cangene’s closing stock price of C$2.70 on December 10, 2013 and 45% to Cangene’s 90-day volume weighted average stock price.  The acquisition will be implemented through a court-approved Plan of Arrangement under Canadian law and is subject to the approval of Cangene common shareholders, court approval and U.S. regulatory approvals and other customary closing conditions. The transaction is expected to be completed in the first calendar quarter of 2014.

Financing

Stem Cell Therapeutics Corp. (TSX-V: SSS) announced that it has raised gross proceeds of $33 million through a private placement of units. In connection with the offering, the Company issued 157,142,858 units at a price of $0.21 each. The units consisted of either one common share and three-quarters of a common share purchase warrant (“Common Share Units”) or one Series 1 Non-Voting First Preferred Share and three-quarters of a common share purchase warrant (“Preferred Share Unit”). Of the total Units issued, 79,247,693 units were Common Share Units and 77,895,165 units were Preferred Shares Units. Each whole warrant entitles the holder to purchase one common share at a price of $0.28 at any time prior to expiry on December 13, 2018. Following the offering, the Company has 121,752,380 common shares issued and outstanding (144,031,618 on a fully diluted basis).

Annidis Corporation (TSX-V: RHA) (the “Corporation”) announced that it will be submitting an application to the TSX Venture Exchange (“TSXV”) for approval to extend the expiry date of certain issued and outstanding common share purchase warrants. In accordance with TSXV Policy 4.1, Annidis Corporation reports that it will submit an application to the TSX-V to extend the term of 3,531,250 warrants which were issued by the Corporation on June 9, 2011 in connection with the completion of the Corporation’s Qualifying Transaction (“QT”). The warrants are presently exercisable at prices of $0.30 and $0.40 per common share and are set to expire between December 18, 2013 and November 4, 2014. The Corporation is applying to extend the expiry date of the warrants to September 30, 2016. All other terms of the warrants, including the exercise prices, will remain unchanged.

Commercial & Other Agreements        

Theratechnologies Inc. (TSX: TH) announced that it has reached an agreement with EMD Serono to regain all rights under the current collaboration and licensing agreement entered into in 2008 with EMD Serono, including commercialization rights for EGRIFTA® (tesamorelin for injection) in the United States. EMD Serono agreed to terminate its collaboration and licensing agreement with Theratechonologies in consideration of an early termination fee of USD 20 million payable over a five-year period starting on the first anniversary of the closing date. Starting in 2016, Theratechnologies will also pay an undisclosed, increasing royalty based on annual net sales. Royalties will be paid until a cumulative aggregate amount is reached or until January 1, 2024, the first of these events to occur. National Bank Financial acted as the exclusive financial advisor to Theratechnologies for this transaction. As a result of the termination of the collaboration and licensing agreement, Theratechnologies will be responsible for all operations in the U.S. relating to EGRIFTA®, including the conduct of the post-approval commitments mandated by the U.S. Food and Drug Administration.

Stellar Biotechnologies, Inc. (“the Company”) (TSX-V: KLH) announced that it has entered into a collaboration agreement with Amaran Biotechnology, Inc., a privately-held Taiwan biopharmaceuticals manufacturer (“Amaran”) to develop and evaluate methods for the manufacture of OBI-822 active immunotherapy using Stellar’s GMP grade Keyhole Limpet Hemocyanin (“KLH”). The primary purpose of the alliance is to develop and evaluate methods for the manufacture of the OBI-822 active immunotherapy using Stellar’s GMP grade KLH. Under the terms of the agreement, Stellar will be responsible for the production and delivery of GMP grade KLH for evaluation as a carrier molecule in OBI-822 immunotherapy. Stellar will also be responsible for method development, product formulation, and process qualification for certain KLH reference standards. Amaran will be responsible for development objectives and product specifications. The agreement provides for Amaran to pay to Stellar fees for certain expenses and costs associated with the development program. Subject to certain conditions and timing, the collaboration also provides for the companies to negotiate a commercial supply agreement for Stellar KLH™ in the future.

NEOMED announced a new collaboration with Johnson & Johnson Innovation, and its affiliate Janssen Inc. Canada, to accelerate the transition of university and biotechnology company early-stage research into potential treatments. Through this collaboration, teams of experienced technical experts at both the Johnson & Johnson Innovation Center in Boston, Massachusetts and NEOMED will work together to identify and advance medically important projects. These projects will come from NEOMED’s network of partnered academic institutions and biotechnology companies, as well as from Canadian, US and international drug discovery groups. Johnson & Johnson Innovation is the third global pharmaceutical company collaborator to join NEOMED since its founding in late 2012. The other global pharmaceutical company partners are AstraZeneca and Pfizer.

LionsGate Technologies Inc. (LGTmedical) and Xhale Assurance Inc. announced the signing of an agreement that will see the two companies co-develop a first-of-its-kind multi-parameter sensor connected and driven through the universal audio-port of almost any mobile device. Xhale Assurance Inc. introduced its revolutionary Alar One-Sense™ Sensor in May of this year. The Alar-One Sense Sensor detects Blood-Oxygen saturation and Heart Rate, and soon will offer breath-to-breath Respiration Rate, at the nasal alar. LGTmedical, through the development of a universal interfacing framework, known as the Vital Signs DSP™, has developed ultra-low cost, mobile vital signs monitoring by connecting compatible medical sensors through the audio port of virtually any mobile device. This novel, audio-based interface will make vital signs monitoring available to healthcare workers and consumers for a fraction of the price of current devices.

Other

CDRD Ventures Inc. (CVI), the commercialization vehicle of The Centre for Drug Research and Development (CDRD), announced the launch of a new spin-off company, Kairos Therapeutics Inc., a biotechnology company developing next-generation antibody-drug conjugate (ADC) therapeutics for cancer. Kairos Therapeutics is developing a family of antibody-drug conjugate therapeutics based on a proprietary toxin and linker platform. Kairos is also developing an internal pipeline of ADCs for the treatment of various forms of cancer. Proprietary site-specific conjugation methodology has been developed to maintain target affinity, effector function, and increase circulation half-life. The technology was developed in-house at CDRD and has been exclusively licensed to Kairos from CVI.

iCo Therapeutics (TSX-V: ICO) announced that on November 26, 2013, U.S. patent 8,592,382 was issued for the Oral Amphotericin B platform (Oral AmpB) providing protection around oral delivery of the drug.  With the recent receipt of ethics approval, the Oral AmpB technology is also moving into in vitro testing with study partners in Montreal, and will examine the role of this formulation in targeting latent HIV reservoirs which remain in individuals despite enormous therapeutic advances in the treatment of HIV/AIDS.

Bioniche Life Sciences Inc. (TSX: BNC) announced that the Australian Securities Exchange (ASX) has approved the Company’s application to delist from the official list of the ASX subject to certain usual conditions. The Company announced its intention to delist on December 1, 2013 due to the very low level of trading on the ASX, the small number of CDIs remaining, and the significant liquidity for Bioniche shares on the TSX. As a result of the delisting, the Company expects to realize a savings in administrative and compliance obligations which will result in cost savings. Following the delisting, Bioniche Common Shares will continue to trade on the TSX.

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