Adherex Announces Merger With Oxiquant - New Entity Will Focus On Developing Pipeline of Anti-Cancer Compounds
OTTAWA--Oct. 2, 2002--Adherex Technologies Inc.
(TSX:AHX) today announced it has entered into an agreement to merge
with Oxiquant Inc., a private US pharmaceutical company developing a
number of novel anti-cancer compounds. The new combined company will
focus on developing anti-cancer therapeutics and it is anticipated
that four compounds will be in clinical development during 2003.
Under the agreement, which was approved unanimously by both
companies' Boards of Directors, the transaction is an equal merger on
a share for share basis between Adherex and Oxiquant. The newly merged
entity will operate in Ottawa under the name Adherex Technologies Inc.
and will have an exclusive focus on the development of anti-cancer
compounds. In addition to their interest in the new Adherex, current
Adherex shareholders will also receive a special dividend of an equal
number of shares in a new spin-off company, Cadherin Biomedical
Research Inc. The spin-off will hold all of Adherex's non-cancer
assets, including the company's transdermal delivery technology. The
agreement is subject to regulatory and shareholder approval and will
be included on the agenda for the company's Annual and Special
Meeting, scheduled for November 5th, 2002.
"We have been able to take advantage of an exciting opportunity to
create a focused company with stronger fundamentals and the necessary
critical mass to ensure our ongoing success. In today's market, size
is an essential success factor and, with these new gains in our
technology, we believe we will be able to capitalize on even more
opportunities in the future" said John Brooks, CEO of Adherex. "We
have a vision of building a significant cancer company, and we've now
found the setting to make it happen, and the management team to drive
it forward." added Dr. Fred Mermelstein, President of Oxiquant,
founder of several biotech companies and proposed incoming board
member. "We view the Adherex cancer technology as a key component of
the new company, with many synergies to the technologies we at
Oxiquant are developing."
Dr. Mark C. Rogers, former professor at Johns Hopkins University
and CEO of the Duke University Medical Center, is to become Chairman
of the Board of the newly merged company. John Brooks, Chief Executive
Officer of Adherex and Robin Norris, MD, President and Chief Operating
Officer of Adherex will continue in their positions in the new entity.
Robert Browne, Chief Financial Officer of Adherex, will be leaving the
company on December 1 to pursue other opportunities. Adherex has been
pleased with the work of Mr. Browne and thanks him for his efforts,
particularly through its IPO.
"Adherex becomes a company with a clear focus on anti-cancer
compounds and immediately has a pipeline consisting of four clinical
stage drug candidates." said Dr. Robin Norris. The four compounds
include Exherin(TM), Adherex's drug candidate that targets N-cadherin
to destroy cancer blood vessels, and three products from Oxiquant:
Sodium Thiosulfate (STS), a chemoprotectant targeted to prevent the
disabling loss of hearing associated with certain drugs including the
widely used platinum-based anticancer agents; Mesna, a compound that
has been shown to display chemotherapeutic activity in the low oxygen
environments of tumors, and thus is potentially therapeutically
synergistic with EXHERIN(TM) and; N-Acetylcysteine (NAC), a
chemoprotectant being studied for treatment in the prevention of bone
marrow suppression and gastric mucosal damage resultant from
"We are very excited about the new opportunities presented by this
merger," Norris added. "The most advanced compound we will have is
Oxiquant's STS, which is in Phase II clinical trials. It targets a
market with a very large unmet medical need and where children are the
largest group of patients.
They can suffer hearing loss, a currently untreatable and
unpreventable side effect from treating their cancers with potent
platinum anti-cancer agents. Many of these children go on to
experience learning difficulties as a result of their hearing loss.
Because there is no treatment currently available, we view STS as a
drug with the potential to get to the market by 2005/2006."
Dr. Ed Neuwelt and his group of researchers at Oregon Health
Sciences University have shown that STS, administered in conjunction
with platinum-based drugs, significantly reduces hearing loss. To
date, several studies have been completed using STS with positive
results reported in pre-clinical, Phase I and Phase II clinical
Adherex is pleased to continue its research collaboration with
AstraZeneca (NYSE:AZN) with respect to its technology targeting
N-cadherin to destroy cancer blood vessels. With the additional
strengths in cancer brought to Adherex through this merger with
Oxiquant, Adherex feels that maximum shareholder value is best
achieved through further development work before a comprehensive
license agreement is negotiated. Adherex has been happy with the
strong collaborative interaction with AstraZeneca and looks forward to
discussing a license opportunity with AstraZeneca at the appropriate
time. Independent of the scientific collaboration with AstraZeneca,
Adherex plans to commence a phase I trial with EXHERIN(TM) later this
"We expect the new company will have access to broader financial
markets, a stronger corporate image to raise capital, and increased
business development opportunities. In addition, the spin-off company
allows for greater focus and realization of other applications of our
platform technology. This transaction presents Adherex shareholders
with the unique opportunity to participate in two focused growth
vehicles," Brooks added.
In order to facilitate access to broader capital markets, the
company will also be asking its shareholders to approve a four for one
share consolidation of its capital stock If approved, Adherex would
have approximately 21 million shares outstanding following the
successful completion of the Oxiquant transaction.
An independent committee of the Adherex Board of Directors
retained Dundee Securities to prepare a fairness opinion on the
transaction. Dundee Securities has determined and reported that the
transaction is fair to the Adherex shareholders from a financial
perspective. Their report was presented to the full Board on September
Adherex will host a conference call and simultaneous audio webcast
at 10:30 am ET today (October 2) to discuss these developments.
Investors, analysts, brokers and media wishing to participate in this
call can do so by calling 877-407-8035 five minutes prior to the start
time or by visiting the Adherex website at www.adherex.com. For those
who are unable to listen to the call live, a telephone post view
service will be in place from approximately one hour after the
conference ends until midnight ET October 3, 2002. The post view can
be accessed at 877-660-6853, (Account 1628, Conference 44943). The
conference call will also be accessible through the Adherex website
until January 28, 2003.
About Adherex Technologies
Adherex Technologies is an Ottawa-based biotechnology company that
develops therapeutic drugs based upon its proprietary cell adhesion
platform technology. The lead compound, EXHERIN(TM), works to destroy
the blood vessels that feed a cancerous tumor, essentially destroying
the tumor's food supply. Adherex's unique cell adhesion platform has
the potential for diverse applications, including drug delivery
through the skin. For more information, please visit Adherex's web
site at www.adherex.com.
Oxiquant is a private, oncology focused bio-pharmaceutical company
developing products for use in cancer chemotherapy. Oxiquant was
incorporated under the laws of the State of Delaware on February 13,
2001 under the name Oxiquant, Inc. Oxiquant's head office is located
at 787 Seventh Avenue, New York, New York 10019 and its registered
office is located at 615 South DuPont Highway, Kent County, Dover,
AstraZeneca is a major international healthcare business engaged
in the research, development, manufacture and marketing of ethical
(prescription) pharmaceuticals and the supply of healthcare services.
It is one of the top five pharmaceutical companies in the world with
healthcare sales of $16.5 billion and leading positions in sales of
gastrointestinal, oncology, anaesthesia including pain management,
cardiovascular, central nervous system (CNS) and respiratory products.
This news release shall not constitute an offer to sell or the
solicitation of an offer to buy nor shall there be any sale of these
securities in any state or jurisdiction in which such offer,
solicitation or sale would be unlawful prior to registration or
qualification under the securities laws of any such state or
Certain information contained in this news release is
forward-looking and is subject to unknown risks and uncertainties. The
actual results, performance or achievements of the company may differ
materially from the results, performance or achievements of the
company expressed or implied by such forward looking statements.