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INDIA BUSINESS WORLD - October 1st - October 15th - 2008
PANACEA AGREES TO BUY 19.9% IN PHARMATHENE FOR $13.1 M
Vaccine maker Panacea Biotec has agreed to buy 19.9% in USbased PharmAthene for $13.1 million. Panacea will route the acquisition through a wholly-owned subsidiary Kelisia Holdings. PharmAthene is developing medical products against biological and chemical threats.
Kelisia Holdings will purchase approximately 3.73 million shares of PharmAthene common stock at $3.50 per share and will also receive warrants to purchase up to 2.75 million additional shares of PharmAthene at $5.10 per share. The transaction is expected to close on or before October 20, 2008, a Panacea Biotec release said.
The first tranche of investment will give Delhi-based Panacea Biotec approximately 14.5% in PharmAthene. With the additional 2.75 million warrants, it will have the right to purchase up to 19.9% of PharmAthene’s issued and outstanding common stock, according to a press statement. “Panacea Biotec is committed to identifying partners for US distribution of our products. We recognise the position that PharmAthene has taken in the biodefense space and the core competencies of its management team with respect to vaccine development and commercialisation,” said Panacea Biotec joint MD Rajesh Jain.
“Our agreement with Panacea Biotec is part of a comprehensive strategy to strengthen our balance sheet and forge a strategic alliance with a globally recognised biopharmaceutical company,” said PharmAthene President and CEO David P Wright.
PharmAthene has the first right of negotiation for US distribution of certain Panacea Biotec’s biodefense products. PharmAthene may also enter potential collaborations, including development and manufacturing of its biodefense products by Panacea Biotec.
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