The Cross-Border Biotech Blog

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

Tag Archives: ConjuChem

Monday Biotech Deal Review: July 26, 2010

Things were interesting for Forbes Medi-Tech (or at least its creditors), which saw a new bidder emerge for its assets. A few placements and other deals closed, some lower than expected. See who made it through the heat without wilting this week after the jump…

Monday Biotech Deal Review: June 14, 2010

This week saw a series of transactions bringing Patient Home Monitoring to the TSXV with an accompanying private placement and a shiny new SEDA from (who else) Yorkville; ConjuChem is (pending court approval) on its way out of CCAA with some cash on hand; and the struggle between Northstar and its ex-CEO continues in the dramatic form of a directors circular. Check out these developments plus a full crop of other Canadian deal activity after the jump…

Monday Biotech Deal Review: March 1, 2010

This week saw a lot of offerings move forward, in the shadow of Anthera’s shrunken and postponed IPO, but the news wasn’t all good in Canada either. ConjuChem filed for restructuring, and other companies are still holding on by their teeth. See who’s who after the jump

Monday Biotech Deal Review: February 22, 2010

There was a lot of follow-up among Canadian biotech deals this week: letters of intent turning into definitive agreements, merged companies turning to consolidation, bids launched on schedule and wrapped up; as well as an average crop of new M&Eh and securities.  Start things off with an interesting (cross-border!) twist to the SIFT/SR&ED deals we’ve seen after the jump…

Monday Biotech Deal Review: January 25, 2010

Everyone’s looking to the future in this week’s deal review: two special committees, 225,000 options, two royalty streams, a delisting notice and the first income trust/tax loss deal of 2010.  Read more of this post

Monday Deal Review: August 31, 2009

B&W_BigNickelThis week Canada seems to have accounted for a significant chunk of the Western Hemisphere’s biopharma deal activity … by numbers, anyway. By dollars, all is dwarfed by the $3.1 billion Proctor & Gamble/Warner Chilcott deal, but don’t let that stop you from reading on after the jump…

Monday Deal Review: August 24, 2009

Another Biotech Windfall from the SIFT Tax: Vasogen Molts for Cervus and Merges with IntelliPharmaCeutics. Shareholders Applaud.

Canadian moneyIn July, we covered the deal ConjuChem Biotechnologies Inc. (TSX: CJB) made with Colabor Income Fund (TSX: CLB.UN), where ConjuChem got $5 million and the Income Fund got a public corporate shell.  ConjuChem had $8.7 million in the bank in April, but was burning it fast (pdf).

Noting at the time that ConjuChem shareholders did not react well to the deal (they still haven’t), we wondered whether future income trusts would find biotech partners willing to try the structure again. Well, the answer is “yes.”

Vasogen Inc. (NASDAQ: VSGN; TSX: VAS), which has been trading under $0.20 since releasing its Q2 results and cutting back to one employee in July, is giving its shell to Cervus LP (TSXV: CVL.UN) unit holders in exchange for $7.5 million.  Cervus is a public LP, but it’s caught by the same Canadian tax change — the SIFT tax — as income trusts, which is what is driving these entities to seek the shells of public corporations.  Vasogen shares have doubled so far today.

What does the Vasogen deal have that the ConjuChem deal lacked? Two things: more cash and a brighter future.

  • More Cash: ConjuChem got $5 million for its shell but Vasogen is getting $7.5 million.
  • A Brighter Future: Unlike ConjuChem, which planned to use its windfall to continue its existing programs, Vasogen leveraged its cash into a deal for 14% of IntelliPharmaCeutics (IPC).

IntelliPharmaCeutics has: a lead product (a generic version of Focalin XR®) that is partnered with Par Pharmaceutical and has an ANDA filed; a generic version of Coreg CR, a high blood pressure medication, that is ready for entry into bioequivalence studies, and a platform for abuse- and alcohol-resistant drug delivery technology that can build a nongeneric product pipeline.

Now IntelliPharmaCeutics will also have extra cash and access to public markets.  Everybody wins (though I assume that if Vasogen is not successful in its conversations with NASDAQ, there will be some problems).

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Monday Deal Review: August 17, 2009

B&W_BigNickelIn addition to the highlights already noted — Enobia’s $50 million r0und, and the LOM – BioQuest joint venture — there was plenty of other Canadian deal activity this week.  Check it out after the jump…

New Data Shows 70% of Canada’s Biotech Companies Have Under 12 Months’ Cash. BIOTECanada’s New Ask: Government Loans.

Canadian moneyA Canwest story today highlights new BIOTECanada data showing 70% of survey respondents have under 1 year of cash, up from 50% in January.  FierceBiotech picked it up as well, guaranteeing a full dose of international attention.  

Even though the remaining 30% of respondents likely include some with big recent successes — Bioniche, Allostera and Zymeworks – and some with creative approaches — ConjuChem, Neuromed, etc. — the top-line number is grim indeed.  Plus, as Kasia Majewski points out:

“Most firms have found away to extend their cash, but they’ve done that by massive layoffs, by shutting done operations to the bare bones. So essentially the lights are on but there’s one guy home.”

Given that there has been no systemic cash infusion, it’s not surprising that the number of firms in trouble has gone up since January. 

On the other hand:

There is a bolus of fund-of-funds and direct capital waiting to be deployed, including:

Plus, Lumira Capital’s Q2 newsletter (pdf) points to the new BDC money, Alberta Investment Management Corp’s PE plans and the new Alberta Enterprise Corporation as potential additional sources of funding in the medium term.

BIOTECanada bottom line:

In the winter, the organization was focused on tax initiatives.  Yesterday, though, the focus was entirely on

“negotiations with Industry Canada to obtain a loan program for Canada’s biotech sector that can hold the industry over until capital markets rebound. … [Specifically,] government loans to be repaid after a two- year period at six per cent interest.”

Maybe it’s the new money looming on the horizon, or the seeming lack of traction for the tax policy asks, but the focus has definitely shifted.

My bottom line:

Even the new loan program advocated by BIOTECanada will not help if the other government funding doesn’t make it to biotech companies and VCs. We’ve been keeping an OVCF scoreboard that still shows a goose-egg for biotech investments.  It may be early days for these new capital sources, but the hour is late for Canadian biotech companies.

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Monday Deal Review: July 12, 2009

B&W_BigNickelThe highlights of this week were definitely the Bioniche-Endo deal and Allostera’s $17 million raise, but that was just the tip of the iceberg as Canadian deal activity heated up along with the weather.  A novel deal with an income trust swapping cash for a biotech’s public shell starts things off after the jump…

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