The Cross-Border Biotech Blog

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

Monday Deal Review: November 25, 2013

  Welcome to your Monday Biotech Deal Review for November 25, 2013! This week saw Patheon enter into an agreement which will take the company private, once the necessary shareholder and court approval is obtained. Futher, Cardiome has closed its acquisition of Swiss-based Correvio in a cash and share deal. On the financing side of things, Aeterna Zentaris announced that it is seeking to raise US$13.7 million with its previosly announced public offering.

Hit the break the see the details on these deals, as well as the rest of the week’s major biotech news.


Patheon Inc. (TSX: PTI) (“Patheon”) announced that it has entered into an arrangement agreement (the “Arrangement Agreement”) with JLL/Delta Patheon Holdings, L.P., a limited partnership (“Newco”) under which Patheon would be taken private pursuant to a court-approved plan of arrangement (the “Arrangement”) under the Canada Business Corporations Act. Newco is sponsored by an entity controlled by JLL Partners, Inc. (“JLL”) and Koninklijke DSM N.V. (“DSM”). Affiliates of JLL currently own 55.7% of the restricted voting shares of Patheon and all of the outstanding class I preferred shares, series D of Patheon (the “Preferred Shares”). The Arrangement Agreement contemplates that Newco will acquire, directly or indirectly, all of the restricted voting shares of Patheon (the “Restricted Voting Shares”), including those held by affiliates of JLL, for cash consideration of US$9.32 per share (the “Cash Consideration”).  In addition, all of the Preferred Shares will be purchased for nominal consideration and cancelled.  The Cash Consideration will be paid in US dollars at closing, and is equivalent to approximately C$9.72 per share (based on the daily noon exchange rate of the Bank of Canada on November 18, 2013).  The transaction provides total consideration to shareholders other than JLL affiliates of approximately US$582 million and implies an equity value for Patheon of approximately US$1.4 billion. Following completion of the transaction, Patheon’s Restricted Voting Shares will be de-listed from the TSX and no longer traded publicly.

Cardiome Pharma Corp. (NASDAQ: CRME / TSX: COM) announced that it has completed the acquisition of Correvio LLC (“Correvio”), a privately held pharmaceutical company headquartered in Geneva, Switzerland. Under the terms of the agreement, Cardiome has acquired 100% of Correvio through the purchase of a combination of assets and shares of its subsidiaries in exchange for 19.9% of Cardiome’s outstanding shares (proforma ownership of approximately 16.6%) and a deferred cash consideration of US$12 M. The deferred cash consideration will be repaid monthly at an amount equal to 10% of cash receipts from product sales and any applicable interest accrued at 10% compounded annually. The adjusted deferred cash consideration must be repaid in full by December 1, 2019.


Lorus Therapeutics Inc. (TSX: LOR) (the “Company”) announced that it has upsized the previously announced C$5,000,000 overnight marketed public offering (the “Offering”) to 12,730,000 common shares of the Company (“Common Shares”) to be issued at a purchase price of $0.55 per Common Share, for gross proceeds of $7,001,500. The Company has agreed to grant to the Underwriters an over-allotment option to purchase up to that number of additional Common Shares equal to 15% of the Common Shares sold pursuant to the Offering at the offering price for a period ending 30 following the closing of the Offering. The Common Shares were offered in British Columbia, Alberta and Ontario by short form prospectus. The Offering is expected to close on or about December 11, 2013.

Immunovaccine Inc. (TSX-V: IMV) has closed the previously announced private placement of its securities, raising gross proceeds of $4.2 million (the “Private Placement”). Under terms of the financing, a total of 10,511,209 common shares (the “Common Shares”) of Immunovaccine were sold at a price of $0.40 per Common Share. In connection with the Private Placement, Immunovaccine has agreed to pay finders’ fees representing an aggregate of $82,562 in cash along with 167,218 Common Shares and 63,000 compensation options, each compensation option entitling its holder to purchase one Common Share at a price of $0.40 per share until May 21, 2015.

Quest PharmaTech Inc. (TSX-V: QPT) (the “Company”) announced  that it plans to close a non-brokered private placement of 10,000,000 units of the Company at a price of $0.10 per unit.  Each unit will be comprised of one common share and one common share purchase warrant.  Each whole warrant will be exercisable into common shares at a price of $0.15 per common share.  The warrants will expire two years from the date of issuance. The private placement will be made to Mr. Hong-Gul Cheong, a resident of South Korea. Upon issuance of the shares under this private placement, and including exercise of the warrants, Mr. Cheong will own approximately 18% of the common shares of Quest on a fully diluted basis, and therefore will be considered an insider of Quest by virtue of owning greater than 10% of the Company’s outstanding common shares.

 Aeterna Zentaris Inc. (NASDAQ: AEZS / TSX: AEZ) (the “Company”) announced the pricing of its previously announced public offering of 13.1 million units (the “Offering”), with each unit consisting of one common share and one whole warrant to purchase one common share, at a purchase price of US$1.15 per unit. Each warrant will be exercisable for a period of five years following the issuance thereof at an exercise price of US$1.60 per share. Net proceeds from the Offering are expected to be approximately US$13.7 million, after deducting underwriting commissions and other expenses related to the Offering. Canaccord Genuity Inc. is acting as the sole book-running manager for the Offering. Maxim Group LLC acted as co-manager for the Offering. The Offering is expected to close on or about November 25, 2013.

Commercial & Other Agreements

ProMetic Life Sciences Inc. (TSX: PLI) announced that it has received a $5.1 million purchase order for the supply of affinity resin from an existing client, a global leader in the biotherapeutics industry. This order represents the first purchase order issued resulting from the licence and long-term supply agreement previously announced on July 8th 2013. The affinity resin will be manufactured by ProMetic at its Isle of Man production facility and supplied to the client throughout 2014 and early 2015. ProMetic’s client will use the resin for large-scale purification of a therapeutic protein product and it is anticipated further orders will be received once the current order is completed.

Axxess Pharma Inc. (PINKSHEETS: AXXE) announced its wholly-owned subsidiary, AllStar Health Brands Inc., has signed with Victory Brands, one of Canada’s leading distributors of Health, Fitness and Nutrition products to sell its TapouT branded products into mass retail, specialty, pharmacies and select online retailers. Initial orders have been placed and Axxess expects to be in several of the mass retailers and online later this month.

Biosign Technologies Inc. (TSX-V: BIO) (the “Company”) announced the execution of a license agreement with Saint John NB based applepeak software to acquire a fully paid up, perpetual, royalty free, non-exclusive license to use and modify the source code for the “applepeak Wellness Record” software platform. Biosign will now integrate features from the Wellness Record into our next iteration of Healthanywhere™. The total license fee of $175,000 was satisfied with the issuance of 3.5 million common shares of Biosign at $0.05/share. The transaction is subject to board & TSX approval, and all securities issued are subject to a hold period of 4 months and 1 day, plus further agreed-upon restrictions on selling over a period of 24 months.

Blueline Bioscience, a Toronto-based biotech incubator launched by Versant Ventures in September of this year, announced a collaboration with Celgene. Blueline Bioscience is headquartered in the MaRS Discovery District of Toronto and works closely with leading academic and medical research centers in Canada to develop, fund, and grow early-stage biotechnology companies. Upon launch of new enterprises by Blueline Bioscience in areas of joint strategic interest such as oncology and inflammation, an affiliate of Celgene Corporation will have certain option rights through the collaboration.


BIOREM Inc. (TSX-V: BRM) (“the Company”) announced two new orders totalling $1.0 million, which are in addition to the $1.9 million in new orders announced in October. The larger order is an industrial odour and VOC (Volatile Organic Compounds) control system in Europe and represents the 7th repeat order for this growing multinational client. The second order is an odour control system for a waste water treatment plant in the United States. Biorem additionally announced that it has not come to agreement on satisfactory payment terms with a Chinese State Owned Enterprise (SOE) for a $2.8 million project located in Southeast Asia and has removed the project from its backlog for the time being.

Leave a Reply

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

You are commenting using your 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


Get every new post delivered to your Inbox.

Join 128 other followers