The biotechnology company MediGene AG has signed an agreement on the acquisition of the privately held biotechnology company Avidex Ltd. based in Oxford, UK.
With this acquisition, MediGene will diversify and broaden its drug pipeline with several drug candidates to treat cancer and autoimmune diseases, and will add a proprietary technology platform to further fuel its future drug pipeline. The lead product, RhuDex, an orally available CD80 inhibitor, will soon enter a phase IIa clinical trial for the treatment of rheumatoid arthritis, and is estimated to achieve annual peak sales of more than EUR 1.5 billion. Several other drug candidates with high potential are currently in research and pre-clinical development stages.
Additional drug candidates will originate from the highly innovative monoclonal T cell receptor technology platform (mTCR), on which Avidex already has a partnership with Syngenta AG. A purchase price for Avidex Ltd. of approximately EUR 50 million in the form of new MediGene shares was agreed upon. The UK-based company will remain at its premises in Oxford and will be operated as a subsidiary of MediGene AG.
"The acquisition of Avidex is a major step forward for MediGene and makes our portfolio to one of the strongest among the European biotech companies," explains Dr. Peter Heinrich, CEO of MediGene AG. "Avidex' autoimmune and cancer product portfolio nicely complements our pipeline and offers additional partnering opportunities. Soluble T cell receptors are one of the most modern therapeutic concepts for cancer and autoimmune-therapy. With the blockbuster candidate RhuDex, the mTCR platform and the cancer drugs derived from our EndoTAG-platform we are well positioned to further develop our business beyond our mature products E and Polyphenon, and to take our innovative drugs to success."
"We are very pleased and excited with this transaction as it will combine the world class research capabilities of Avidex with the very strong development and commercial expertise in MediGene. We are confident this combination will create one of Europe's leading biotechnology companies with a very substantial pipeline of product opportunities," comments Jerry Benjamin, General Partner of Advent Venture Partners Limited.
With the signing of the share purchase agreement MediGene intends to acquire 100 per cent of the Avidex shares outstanding. As a consideration the Avidex shareholders will receive approximately 8.2 million MediGene shares. Thus the value of the transaction at current market price amounts to approximately EUR 50 million. Shareholders owning over 90 per cent of the Avidex shares have already agreed on the acquisition. Upon closing of the
transaction which is scheduled for mid-October, Avidex shareholders will own 28 per cent of all MediGene shares outstanding. The majority of the new shares are subject to a lock-up period of twelve months. Between now and closing of the acquisition Avidex' investors will contribute GBP 3 million in cash to fund Avidex' clinical and preclinical programmes. This capital increase led by Advent raises Avidex' cash level to approximately EUR 7 million.
In order to secure additional cash funds for the subsequent development of the acquired projects, MediGene has entered into a step-up financing agreement with Societe Generale. Pursuant to the agreement, MediGene has the option of successively selling up to two million new shares to Societe Generale at a level close to the current market price within a period of 18 months.