Welcome to your Monday Biotech Deal Review for February 10, 2014! The big news this week was Valeant’s proposed acquisition of another skin care innovator, PreCision Dermatology, for $475 million. Hit the break for more details on this as well as the rest of the week’s major biotech news.
Patheon Inc. (TSX: PTI) (“Patheon”) announced that it has filed its definitive proxy statement and management information circular (the “Proxy Statement”) with Canadian and U.S. securities regulators in connection with a special meeting of holders of restricted voting shares (the “Special Meeting”) to be held to consider, and if deemed appropriate, to approve, among other things, a statutory plan of arrangement under the Canada Business Corporations Act (the “Arrangement”) that would effect a going private transaction. On the closing of the proposed Arrangement, which was originally announced on November 19, 2013, JLL/Delta Patheon Holdings, L.P. (“Newco”) will acquire, directly or indirectly, all of the restricted voting shares of Patheon. Newco is sponsored by an entity controlled by JLL Partners, Inc. and Koninklijke DSM N.V.
Valeant Pharmaceuticals International, Inc. (NYSE: VRX and TSX: VRX) announced that it has entered into a definitive agreement under which Valeant will acquire PreCision Dermatology, Inc. for $475 million in cash, plus an additional $25 million payable upon the achievement of a sales-based milestone. PreCision expects to have approximately $130 million in revenue in 2014. The transaction is expected to close in the first half of 2014 and Valeant expects the transaction, once completed, to be immediately accretive to Valeant’s cash earnings per share.
Critical Outcome Technologies Inc. (TSX-V: COT) announced that it has completed an arm’s length non-brokered private placement raising approximately $500,000 consisting of a non-convertible debenture (the “Debenture”) in the amount of $400,000 and an equity placement of 769,230 units (the “Units”) at a price of $0.13 per Unit for approximately $100,000. The Debenture has a term of one year from the date of issuance and bears interest at a rate of 10% with interest only payable on a monthly basis. In addition to the interest cost of the Debenture, the Company issued 1,250,000 common share purchase warrants (the “Debenture Warrants”) with an exercise price of $0.20 and a one-year term with vesting occurring immediately upon issuance of the Debenture.
Kane Biotech Inc. (TSX-V: KNE) announced it has received a total of $397,500 from the exercising of 2,650,000 warrants at $.15 per share from warrant holders. The warrants were issued on December 14, 2012 as part of a previously announced financing. The warrants exercised included 1,400,000 warrants exercised by insiders of the company. The remaining warrants issued in conjunction with the financing have expired.
Commercial & Other Agreements
ProMetic Life Sciences Inc. (TSX: PLI) (“ProMetic”) announced that its UK based subsidiary, ProMetic BioSciences Ltd. (“PBL”), has entered into a new agreement with a leading vaccines company. The Agreement is structured to provide ProMetic with potential initial service revenues of up to $1.6 million over the next twelve months assuming successful completion of ongoing milestones, with work commencing immediately. This agreement is also anticipated to lead to a subsequent long-term agreement for the manufacture and supply of the affinity resin for use in scale-up and commercial production of the vaccine product.
Axxess Pharma Inc. (PINKSHEETS: AXXE) announced through its wholly-owned subsidiary AllStar Health Brands Inc. it has signed an agreement with Big Brand Media for web development, advertising, and general brand development including Social Media for its TapouT® brand suite of supplements. Big Brand Media will be devoted to developing and increasing online information in the manner of web development, advertising (print/online), search engine optimization, YouTube videos, brand management, tested statements, and fan pages on Twitter/Facebook and Instagram.
GE Licensing is making GE-developed intellectual property (IP) available to entrepreneurs and small businesses to bring technologies with commercial potential to market faster. As part of a pilot to test the approach, the first licensee of GE developed technology will be Edmonton’s Vadu Inc. Vadu plans to commercialize a proprietary GE video analytics technology. The licensing arrangement will offer Vadu access to a variety of services including GE technical resources for help with product development, product demonstration support, business advisory services, and market and competitive intelligence through GE’s Customer Innovation Centre.
Premier Diagnostic Health Services Inc. (“Premier”) (CNSX: PDH) announced that it has been issued a General Cease Trade Order (CTO) by the British Columbia Securities Commission. An application for a Management Cease Trade Order (MCTO) was made in respect to the late filing of the Company’s audited annual financial statements for the fiscal year ended September 30, 2013 and its management’s discussion and analysis relating thereto (collectively, the “Required Filings”) which were due on January 28, 2014, but this was denied due to the previous granting of a MCTO for fiscal years 2011 and 2012. The delay in filing the Required Filings is principally related to the delays of obtaining the required information from the Company’s subsidiaries in China and Hong Kong. The CTO will prohibit the trading of securities of Premier for so long as the Required Filings are not filed. Premier is making every effort to complete the Required Filings in a timely fashion and expects to file the audited annual financial statements by February 28th, 2014.