Date: 2012-11-07
Type of information: Company acquisition
Acquired company: Epicept (USA)
Acquiring company: Immune Pharmaceuticals (Israel)
Amount:
Terms: Immune Pharmaceuticals, a privately held Israeli company, and EpiCept have entered into a definitive merger agreement. The transaction is anticipated to close during the first quarter of 2013 and is subject to satisfaction of certain customary closing conditions, including the approval of a majority of EpiCept shareholders. The terms of the merger agreement provide for EpiCept to issue shares of its common stock to Immune shareholders in exchange for all of the outstanding shares of Immune, with EpiCept shareholders retaining approximately 22.5 percent ownership of the combined company and Immune shareholders receiving approximately 77.5 percent, calculated on an adjusted fully diluted basis.
Dr. Daniel Teper will become the Chairman and Chief Executive Officer of Immune Pharmaceuticals, which will have dual headquarters in Herzliya-Pituach, Israel and in the New York City area, with research laboratories in Rehovot, Israel. Dr. David Sidransky, Director of Head and Neck Research Division, Professor of Oncology at the Johns Hopkins School of Medicine, and a former Vice Chairman of the Board of Directors of ImClone Systems, will be the Vice Chairman of the Board of Immune Pharmaceuticals. The Immune Pharmaceuticals management team will include Robert Cook, EpiCept's Interim Chief Executive Officer, who will become the combined company's Chief Financial Officer, and Stephane Allard, M.D., EpiCept's Chief Medical Officer, who will become Immune Pharmaceutical's Chief Medical Officer. Serge Goldner, Chief Financial Officer of Immune will take the new role of Executive Vice President and Chief Operating Officer. Suzy Jones, a former Genentech executive, and Myrtle Potter & Company will continue to advise Immune Pharmaceuticals on business development and the combined company's Scientific Board will be jointly led by Professor Marc Rothenberg (Cincinnati Children's Hospital) and Professor Shimon Benita (Hebrew University).
Details: The combined company, to be named Immune Pharmaceuticals, will be primarily focused on developing antibody therapeutics and other targeted drugs for the treatment of inflammatory diseases and cancer. The transaction will create a publicly traded specialty biopharmaceutical company with a portfolio of product candidates for the treatment of inflammatory diseases and cancer.
Immune's lead product candidate, bertilimumab, is a full human monoclonal antibody that targets eotaxin-1, a chemokine involved in eosinophilic inflammation, angiogenesis and neurogenesis. Immune is currently initiating a placebo-controlled, double-blind Phase II clinical trial with bertilimumab for the treatment of ulcerative colitis. The companies' collective oncology portfolios comprise: Immune's NanomAbs®, a new generation of antibody drug conjugates, and EpiCept's vascular disruptive agents.
Immune Pharmaceuticals will continue efforts to secure a partner for EpiCept's Phase III clinical development candidate AmiKet™, for which efficacy has been demonstrated for the treatment of chemotherapy-induced neuropathic pain and post-herpetic neuralgia.
* On February 12, 2013, EpiCept and Immune Pharmaceuticals announced that they have executed an amendment to the Merger Agreement and Plan of Reorganization that they signed on November 7, 2012 .
Under the terms of the amendment, Immune may, at any time and from time to time prior to the effective time of the merger, purchase new shares of EpiCept common stock directly from EpiCept at a purchase price of $0.13 per share. Any shares of EpiCept common stock sold to Immune in such a pre-merger investment will be cancelled at the effective time of the merger, but the relative post-closing ownership percentages in the combined company will be adjusted at the closing such that, for each $100,000 invested by Immune in EpiCept pursuant to such a pre-merger investment (up to an aggregate of $500,000 ), the post-closing ownership percentage of the pre-closing Immune stockholders in the combined company will be increased by an additional 0.7%. The amendment results in values for EpiCept and Immune of $14 million and $61 million , respectively, for an assumed combined company valuation of approximately $75 million . The parties will negotiate any further adjustments to the relative post-closing ownership percentages in the combined company that may apply to amounts in excess of $500,000 that Immune invests by purchasing shares of EpiCept common stock from EpiCept .
The merger agreement was further amended to allow Immune time to provide its audited 2012 financial statements, which are required by February 28, 2013 .
Related: drug development
inflammatory diseases
cancer
monoclonal antibodies
