News Archive
11 March 2008
Doylestown PA, USA and Oxford, UK – EUSA Pharma Inc
(‘EUSA’), a transatlantic specialty pharmaceutical company focused
on oncology, pain control and critical care, today announced that it
has entered into a definitive agreement to acquire all the
outstanding shares of Cytogen Corporation (NASDAQ: CYTO) for $22.6
million. Cytogen is a specialty pharmaceutical company with three
oncology and pain control products on the American market, a
specialist US sales force and an established commercial
infrastructure. To meet the acquisition consideration, and fund
further investments, EUSA Pharma has concurrently raised over $50
million in an investment round, led by TVM Capital, an international
venture capital firm.
“The acquisition of Cytogen is of great strategic importance for
EUSA as it completes the building of our transatlantic
commercialization infrastructure, as well as fitting perfectly with
our focus on oncology and pain control,” said Bryan Morton, Chief
Executive of EUSA Pharma. “Over the last 18 months EUSA has built a
strong European organization covering over 20 countries and
marketing a portfolio of six specialty pharmaceuticals. Cytogen’s
products and US infrastructure are the ideal complement to our
business, offering us the opportunity to commercialize a rapidly
growing portfolio of medicines on both sides of the Atlantic.”
Commenting on the acquisition, Rolf Stahel, Chairman of EUSA Pharma,
said, “The acquisition of Cytogen marks a step change in the growth
of EUSA and completes the foundations of a world-class specialty
pharmaceutical company. This transaction will transform our
business, putting in place a truly transatlantic growth platform,
and positioning the company as the partner of choice for future
acquisitions and specialty product in-licensing.”
Strategic rationale
The acquisition of Cytogen brings to the enlarged EUSA group an
established US commercial organization with a 40-strong specialist
oncology sales force and three marketed products.
• Caphosol® is a supersaturated calcium phosphate rinse indicated
for the treatment of oral mucositis, a common and debilitating
side-effect of radiation therapy and high-dose chemotherapy, and for
the treatment of xerostomia.
• ProstaScint® is a monoclonal antibody-based agent used to image
the extent and spread of prostate cancer.
• Quadramet® is a radiopharmaceutical for the treatment of pain in
patients whose cancer has spread to the bones.
The enlarged group will have broad sales and marketing capabilities,
via direct sales forces in the US and across Europe, and through
distribution partners in a number of territories including Canada,
South America and Asia. EUSA will have a portfolio of nine marketed
medicines and five late-stage development products. The acquisition
of Cytogen provides EUSA with the capabilities to commercialize a
number of these medicines on both sides of the Atlantic.
In addition, the enlarged group’s transatlantic infrastructure
provides the company with a strategic growth platform to exploit
additional products through acquisition and in-licensing. With its
highly focused business model, EUSA will have the opportunity to
compete effectively with major players, making it an attractive
partner for companies seeking specialist transatlantic commercial
and late-stage development expertise.
Transaction details
Under the terms of the all-cash merger agreement Cytogen
shareholders will receive $0.62 per share, representing a 35%
premium on the company’s share price at the close of trading on 10
March 2008, and valuing the company at $22.6 million.
The Cytogen Board has approved the cash merger agreement and
resolved to recommend that the company’s shareholders adopt the
agreement. Completion of the acquisition is conditional on the
approval of a majority of Cytogen’s shareholders and fulfillment of
certain pre-closing conditions. Upon completion, EUSA intends to
apply to delist all Cytogen’s issued shares from the NASDAQ stock
exchange.
To meet the consideration for the acquisition, provide working
capital to integrate and refocus the Cytogen organization and
undertake further investments, EUSA Pharma has raised over $50
million in an investment fundraising. This investment round, which
is conditional on the completion of the Cytogen acquisition, is led
by TVM Capital and supported by EUSA’s existing investors, Essex
Woodlands, 3i, Goldman Sachs, Advent Venture Partners, SV Life
Sciences, NeoMed and NovaQuest.
Financial position
During 2007, Cytogen’s revenues totaled $20.2 million, with the
company making a net loss of $25.7 million for the year. At the end
of December 2007 the company held cash and cash equivalents totaling
$8.9 million. During 2007, Cytogen began a program to refocus its
strategy, reduce costs and promote its products more effectively by
building on its expertise in the oncology field. EUSA intends to
accelerate this initiative and rapidly drive the business to
profitability, while retaining the strengths of the Cytogen
organization.
About EUSA Pharma Inc
EUSA Pharma is a rapidly growing transatlantic specialty
pharmaceutical company focused on in-licensing, developing and
marketing late-stage oncology, pain control and critical care
products. The company currently has six products on the market,
including the antibiotic surgical implant Collatamp® G, Erwinase®
and Kidrolase® for the treatment of acute lymphoblastic leukemia,
and Rapydan®, a rapid-onset anesthetic patch which recently received
Europe-wide approval. EUSA also has several products in late-stage
development, notably Collatamp® G topical, a gentamicin impregnated
collagen sponge for the prevention and treatment of infected skin
ulcers, and CollaRx® bupivacaine implant* for local post-surgical
pain control.
Founded in 2006, EUSA Pharma is supported by a consortium of leading
life science capital investors, comprising TVM Capital, Essex
Woodlands, 3i, Goldman Sachs, Advent Venture Partners, SV Life
Sciences, NeoMed and NovaQuest. Since its foundation, the company
has raised over $225 million in addition to the fund raising
announced today, and completed several significant transactions,
including the acquisitions of Talisker Pharma Ltd, the French
biopharmaceutical company OPi SA and the European antibiotic and
pain control business of Innocoll Pharmaceuticals Inc. As part of
its rapid growth strategy the company has established commercial
infrastructure in the US, a pan-European presence covering over 20
countries and a wider distribution network in a further 25
territories. EUSA Pharma plans to continue its aggressive program of
acquisitions and in-licensing within its specialist areas of medical
and geographic focus, in line with its ambitious target to create a
rapidly growing $1 billion company by the beginning of the next
decade.
For more information please visit
www.eusapharma.com.
*CollaRx® is a registered trademark of Innocoll Technologies Ltd.
TVM Capital
TVM Capital, founded in 1983, is one of the first venture capital
firms formed in Germany and was an early entrant into the US market
in 1986. Since inception, TVM Capital has raised more than € 1.3
billion in six fund generations and has established itself as a
leading international technology and life science investment group.
TVM Capital funds have made investments in more than 235 technology
and life science companies including emerging technology sectors
such as energy efficiency, renewable energy generation, energy
storage and water treatment. Over the life of the firm, TVM Capital
has developed specialized, focused teams and dedicated funds to
serve high-growth target markets. The TVM Capital investment
strategy is to create global businesses that enjoy worldwide access
to science, technology, management talent and capital, and to
develop them into significant players in their markets. More than 50
TVM Capital backed companies have gone public on European or US
stock exchanges. Today, TVM Capital is actively invested in 70
companies.
For more information please visit:
www.tvm-capital.com.
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