Paladin and SpePharm Announce New Strategic Relationship and Financing
Paladin Labs Inc., a Canadian specialty pharmaceutical company, today announced that it has made a strategic investment in SpePharm Holding B.V. SpePharm is a rapidly-growing, specialty pharmaceutical company focused on acquiring, registering and marketing high medical value specialty medicines throughout Europe.
Under the terms of this agreement, Paladin will invest 4 million Euros in SpePharm through a secured convertible debenture. Under the financing terms of this new relationship, conversion of Paladin's interest-bearing debt into equity would provide Paladin with an approximate 10% ownership interest in SpePharm. Paladin also secures a right of first discussion for all future debt funding during the term of the secured convertible debenture. In addition to these financing elements, the relationship establishes significant future strategic collaboration and value potential for both parties. As an immediate first step, in furtherance of Paladin's interest in expanding its geographic footprint and portfolio of products, it will be granted an exclusive license to Savene@ for South Africa and Israel. Savene@ is the only approved treatment for anthracycline extravastion, and has EMEA approval. As a second step, under the agreement, SpePharm and Paladin grant each other reciprocal rights in their respective geographies that flow from any future product acquisitions or licensing transactions. Given the strategic importance and broad nature of this relationship, Paladin will also be entitled to place a representative on SpePharm's Supervisory Board.
"International growth will be a core component of Paladin's future business and we view this investment as a strategic yet risk mitigated way to expand our international reach," stated Jonathan Ross Goodman, President & CEO of Paladin Labs Inc. "SpePharm is a pan-European specialty pharmaceutical company with a similar business strategy to Paladin of in-licensing and acquiring innovative pharmaceuticals. By investing in SpePharm, we will be able to further accelerate our existing business development search and acquisition activities via exposure to all the transactions that SpePharm is looking at. Importantly, this will also enable Paladin to offer potential licensors a capable and proven marketing partner for Europe. I look forward to sharing business growth ideas with SpePharm in a more formal manner to the benefit of our respective businesses."
"We are pleased to see Paladin Labs become a strategic partner in SpePharm," stated Jean-Francois Labbe, Managing Director and Chief Executive Officer of SpePharm; "we believe that this transaction not only provides us with additional capital to acquire new products but also provides important business development synergies for the future benefit of both companies."