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BioAlliance Pharma and Topotarget Announce Merger Agreement

Wed, 04/16/2014 - 8:22am

BioAlliance Pharma SA and Topotarget A/S today announced their intention to merge to create an orphan oncology company with a highly complementary pipeline of late-stage products addressing significant unmet medical needs. The merger agreement has been unanimously approved by the Boards of Directors of both companies.

Under the terms of the merger agreement, BioAlliance Pharma will be the continuing company and shares issued by Topotarget will be exchanged to the effect that shareholders of Topotarget will receive 2 newly issued shares in BioAlliance Pharma for each 27 Topotarget shares held, resulting in shareholders of Topotarget owning approximately 1/3 of the shares in the merged company, while existing shareholders of BioAlliance Pharma will hold approximately 2/3.

Highlights of Transaction:

The merger of the two biopharmaceutical companies creates a leading orphan oncology company with a highly complementary pipeline of late-stage targeting genuine unmet medical needs

The total market for orphan oncology drugs exceeds USD ~45 billion in 2013 and is expected to reach USD ~80 billion in 2018. The overall unmet medical need is significant and new rare (or orphan) diseases are continuously discovered

The new entity will be supported by a highly complementary pipeline of late-stage products with several significant value-creating events anticipated in both the short and medium term, and will benefit from operational efficiencies, combined knowledge-sharing, and a diversified revenue stream driving growth

Topotarget’s primary product, belinostat, is a novel pan-HDAC (histone deacetylase) inhibitor with more than 1,100 patients treated

Belinostat is in a pre-registration phase with the FDA for the treatment of relapsed or refractory PTCL (peripheral T-cell lymphoma). Following the assignment of a Prescription Drug User Fee Act, the expected date for an approval is August 9, 2014. The approval would trigger a milestone cash payment of USD 25 million from Topotarget’s US partner, Spectrum Pharmaceuticals as well as a double-digit royalty of sales going forward

The compound has potential for being explored into other rare cancer indications within hematology and solid tumors. Topotarget holds the exclusive rights outside North America and India.

BioAlliance Pharma has two products in late-stage development

Livatag ® is currently in a pivotal phase III clinical trial in primary liver cancer, with potential estimated sales of 800 million euros and patent protection until 2032

Validive ®, the second most advanced product of BioAlliance Pharma’s orphan oncology program, was granted Fast Track Designation by the FDA for the prevention and treatment of oral mucositis induced by anticancer treatments in January 2014 and preliminary data from a large international phase II trial are expected in Q4 2014

The merger will result in a broadened shareholder base with increased market capitalization, and a strengthened value proposition for US and European based investors

The combined company will be under the leadership of an experienced management team and supervised by a highly skilled international Board of Directors with extensive pharmaceutical industry experience and proven track record

The merger agreement is endorsed by the two largest institutional shareholders of both companies – in the case of BioAlliance Pharma by Financière de la Montagne and Idinvest Partners, representing 18.8% of the share capital of BioAlliance Pharma and in the case of Topotarget by HealthCap funds and HBM Healthcare Investments, representing 12.6% of the non-diluted share capital of Topotarget – who have agreed to vote in favor of the merger proposal at the upcoming extraordinary general meetings of the respective companies

Patrick Langlois, Chairman of the Board of Directors of BioAlliance Pharma, said: “ Merging with Topotarget is a major milestone for BioAlliance Pharma. This transaction will result in a new and true leader in orphan oncology. I am confident that, under the leadership of Judith Greciet, the new entity will unleash its full potential and create value for our shareholders.”

Judith Greciet, Chief Executive Officer of BioAlliance Pharma, said : “The merger with Topotarget will strengthen and diversify our position in rare oncology diseases. Topotarget is managed by a highly-experienced team of executives, and the merger will enable both teams to combine their respective expertise to create a new company with a robust and innovative pipeline that is primed for success. It is a unique and timely opportunity to develop an orphan oncology portfolio, which addresses a wider range of life-threatening medical conditions, while creating value for our shareholders”.

Bo Jesper Hansen, Chairman of the Board of Directors Topotarget, said: "Following an extensive strategic review I am confident that we have found the best solution for our shareholders and I am very pleased to see their support as well as the support from BioAlliance Pharma’s largest shareholders. It demonstrates that it is a “meeting of similar minds” with a shared vision of creating an immediately leading orphan oncology company with a strong patient focus”.

Anders Vadsholt, CEO of Topotarget, said: “The positioning of BioAlliance Pharma, their late stage assets and expertise makes BioAlliance Pharma a perfect fit as a company to merge with, allowing the acceleration of belinostat development in several new orphan oncology indications by leveraging on both team’s synergistic expertise. We are confident that this merger will deliver to our shareholders the best possible value and the opportunity to jointly shape a dynamic new player in the orphan oncology market.”

Key transaction terms

Shares issued by Topotarget will be exchanged to the effect that shareholders of Topotarget will receive 2 newly issued shares in the continuing company, BioAlliance Pharma, for 27 Topotarget shares held, resulting in shareholders of Topotarget owning approximately 1/3 of the shares in the merged company, while existing shareholders of BioAlliance Pharma will hold approximately 2/3

The merger will be structured as a tax exempt cross-border merger in accordance with Danish, French, and EU legislation

The merger proposal is, among others, subject to approval at extraordinary general meetings which are expected to be held on June 27, 2014 for Topotarget and on June 30, 2014 for BioAlliance Pharma

All equity warrants issued by Topotarget (including any warrants not yet vested) will be accelerated and thereby allow the holders of such warrants to exercise their warrants during a period to be determined shortly (those non-exercised will be forfeited)

The merger is expected to be completed in July/August 2014

BioAlliance Pharma, listed on Euronext Paris, will apply for a dual listing of its shares at NASDAQ OMX Copenhagen

Further details on the merger features and terms thereof will be given on or about the time of the calling for the extraordinary general meetings expected on May 26, 2014. Any decision to participate in the merger should be based on the full documentation, including a registered prospectus ( Document E ) and a merger plan, to be published ahead of the general meetings.

Management and Corporate Governance following completion of the merger

The combined company will be led by Judith Greciet, Chief Executive Officer of BioAlliance Pharma

Mr. Patrick Langlois, will continue to serve as chairman of the Board of Directors of BioAlliance Pharma. Mr. Bo Jesper Hansen, current Chairman of the Board of Topotarget and Mr. Per Samuelsson, HealthCap funds, current member of the Board of Directors of Topotarget are expected to be appointed as members of the Board of Directors of BioAlliance Pharma

Expected indicative timetable

May 22, 2014

 

 

Meeting of the Boards of Directors to approve final merger documentation, following exercise of Topotarget warrants

 

 

Press release / company announcement on final terms of the merger

May 23/27, 2014

 

 

Filing of final merger plan with French and Danish authorities (post-exercise period of the Topotarget equity warrants)

 

 

Clearance statement ( enregistrement ) on merger prospectus ( Document E ) from French regulator and passport of merger prospectus to Denmark

 

 

Calling for the Extraordinary General Meetings

June 27, 2014

 

 

Extraordinary General Meeting of Topotarget to approve merger

June 30, 2014

 

 

Extraordinary General Meeting of BioAlliance to approve merger

July/August 2014

 

 

Completion of the merger

 

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