Combined Company Boasts Complementary Suite of Transdermal Drug Delivery
Technologies and Strategic Relationship with Cato Research
FRANKLIN, Mass., and DURHAM, N.C., Sept. 17 /PRNewswire-FirstCall/ --
Sontra Medical Corporation (OTC Bulletin Board: SONT.OB), a leader in
transdermal technology, and Echo Therapeutics, Inc., a privately held
specialty transdermal therapeutics company, jointly announced today that
they have merged to form a single, publicly held company to operate under
the name Echo Therapeutics, Inc. Pursuant to the parties' definitive merger
agreement, Sontra acquired all of the outstanding shares of Echo common
stock in exchange for an aggregate of 6,250,000 shares of Sontra common
stock. The stockholders of Sontra and former stockholders of Echo hold
approximately 65 percent (65%) and 35 percent (35%) of the combined
company's outstanding common stock, respectively. The newly combined
company will have corporate offices in Philadelphia and research and
development facilities in Franklin, MA and Durham, NC. Patrick T. Mooney,
M.D. and Shawn K. Singh, J.D., both formerly of Echo, will serve as Chief
Executive Officer and Interim President of the combined company,
respectively. Harry G. Mitchell, CPA, of Sontra, will continue to serve as
Chief Operating Officer and Chief Financial Officer of the combined
company. Burnham Hill Partners, a division of Pali Capital, Inc., served as
financial advisor to Sontra in connection with the merger and in connection
with a separate $1.325 million bridge note financing to a limited group of
strategic institutional and accredited investors.
"This merger is a timely combination of two late-stage and powerful
transdermal drug penetration technologies," said Patrick Mooney, M.D.,
Echo's Chief Executive Officer. "Together, we are now ideally positioned to
leverage and monetize both technologies through a continuing stream of
strategic drug development and marketing partnerships. Our long-term
strategic relationship with Cato Research, a highly-respected global
contract research organization, will enable the combined company to
maximize the output of its two core technology platforms and minimize the
clinical development and regulatory risks."
"We entered into this merger based on the strategic rationale that a
second and complementary platform technology would expand our opportunities
for long-term growth," said Michael Wigley, Sontra's Chairman. "The merger
with Echo validates and supports Sontra's strategy over the last nine
months which has been focused on stabilizing our financial condition,
capitalizing the company for future growth, and continuing development and
commercialization programs that are strategically relevant to our long term
plan."
Highlights of the Transaction
The merger created a leading, platform-enabled transdermal therapeutics
and diagnostics company focused on multiple large markets for improved
formulations of specialty pharmaceuticals and new applications of next
generation transdermal diagnostics. The combined company is marked by the
following key attributes and capabilities:
-- Two transdermal drug penetration technologies, with emphasis on
development and commercialization improved formulations of well-
established, FDA-approved products in concert with a 505(b)(2)
regulatory strategy
-- Diverse, late-stage pipeline, with one FDA-approved product, a second
product candidate covered by a pending NDA filed with the FDA and seven
(7) pipeline candidate programs in development covering eight (8)
different indications
-- Experienced management team and Board of Directors with public company
expertise and critical competencies necessary to capitalize on the
value inherent in each technology platform
-- Long-term strategic development and regulatory partnership with Cato
Research, an established global contract research organization, to
maximize development efficiencies and reduce clinical development and
regulatory risks
-- Expertise from Cato Research will strengthen and expand the reach of
ongoing late-stage clinical development programs in continuous
transdermal glucose monitoring (CTGM) for the diabetes home use and
hospital intensive and critical care settings
About Sontra Medical Corporation
Sontra Medical Corporation owns technology in ultrasound and skin
permeation methods used in transdermal science for therapeutic and
diagnostic applications, and are developing a non-invasive CTGM for use in
the large diabetes home use and hospital intensive and critical care
markets. Sontra's CTGM device leverages its FDA-approved SonoPrep(R)
ultrasound-mediated skin permeation system.
About Echo Therapeutics, Patrick T. Mooney, MD and Shawn K. Singh, JD
Echo Therapeutics is a platform-enabled specialty transdermal
therapeutics company developing a broad portfolio of advanced topical
formulations of well established, FDA-approved products using its
proprietary Azone dermal penetration technology. Echo has submitted a new
drug application (NDA) to the FDA for the approval of its lead product,
Durhalieve, for treatment of corticosteroid responsive dermatoses.
Dr. Mooney will serve as Chief Executive Officer and director of the
combined company. He joined Echo in September 2006 as President, Chief
Executive Officer and director. Prior to joining Echo, Dr. Mooney was
President, Chief Executive Officer and Chairman of Aphton Corporation
(Nasdaq: APHT), where he also served as Chief Medical Officer. Prior to
Aphton Dr. Mooney served as Vice President, Senior Biotechnology Analyst
for Thomas Weisel Partners, LLC, a full service merchant banking firm. Dr.
Mooney received his medical degree from the Jefferson Medical College of
Thomas Jefferson University and trained in surgery at Thomas Jefferson
University Hospital.
Mr. Singh will serve as interim, part-time President and director of
the combined company. He joined Echo in 2004 and served as President and
director prior to his appointment as Chairman of the Board in 2006. He has
been working with life science companies for nearly 20 years. In addition
to his role with Echo, Mr. Singh serves as a Principal of Cato BioVentures,
the venture capital affiliate of Cato Research, a contract research
organization of which he serves as Chief Business Officer, and interim
Chief Operating Officer and director of VistaGen Therapeutics. Prior to
joining Echo, Mr. Singh served as Chief Business Officer of SciClone
Pharmaceuticals (Nasdaq: SCLN), President of Artemis Neuroscience and
Corporate Finance Associate in the Silicon Valley offices of Morrison &
Foerster. Mr. Singh also serves as part-time Chief Executive Officer of
Hemodynamic Therapeutics, a majority-owned subsidiary of Cato BioVentures.
About Cato Research Ltd.
Founded in 1988 by Dr. Allen Cato and Lynda Sutton and headquartered
near Research Triangle Park, NC, Cato Research is a privately held,
full-service contract research and development organization providing
strategic and tactical support for clients in the pharmaceutical,
biotechnology, medical device, and medical diagnostic industries. With a
staff of more than 300 and offices located in the United States, Canada,
Europe, Israel and South Africa, Cato Research's services range from design
and management of preclinical and clinical studies to submission of
regulatory documents required for marketing approval.
About Burnham Hill Partners
Burnham Hill Partners, based in New York City, was formed in August
2003 and is a division of Pali Capital Inc., a NASD registered broker
dealer. The professionals at Burnham Hill Partners have extensive
experience providing comprehensive financing and financial advisory
services to publicly traded companies with market capitalizations up to
$250 million. Burnham Hill Partners' sector expertise includes
telecommunications, electronics equipment and services, network security
and software as well as medical devices and life sciences.
SonoPrep is a registered trademark of Sontra Medical Corporation. All
other company, product or service names mentioned herein are the trademarks
or registered trademarks of their respective owners.
Any statements contained in this press release that do not describe
historical facts may constitute forward-looking statements as that term is
defined in the Private Securities Litigation Reform Act of 1995. Any
forward- looking statements contained herein are based on current
expectations, but are subject to a number of risks and uncertainties. The
factors that could cause actual future results to differ materially from
current expectations include, but are not limited to, risks and
uncertainties relating to the Company's ability to sell additional shares
of common stock and warrants to purchase common stock at additional
closings, the Company's ability to develop, market and sell products based
on its technology, including a continuous transdermal glucose monitor for
the diabetes and hospital ICU market; the expected benefits and efficacy of
the SonoPrep device in connection with diagnostics, glucose monitoring and
transdermal science; the availability of substantial additional funding for
the Company to continue its operations and to conduct research and
development, clinical studies and future product commercialization; and,
the Company's business, research, product development, regulatory approval,
marketing and distribution plans and strategies. These and other factors
are identified and described in more detail in our filings with the SEC,
including, without limitation, our respective annual reports on Form 10-KSB
for the year ended December 31, 2006, our respective quarterly reports on
Form 10-QSB, and our current reports on Form 8-K. We do not undertake to
update these forward-looking statements made by us.
Investor Relations Contacts:
Patrick T. Mooney, M.D., CEO
508-530-0329
pmooney@echotx.com
SOURCE Sontra Medical Corporation
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Related links:
http://www.sontra.com
CONTACT:
Investor Relations, Patrick T. Mooney, M.D.,
CEO, +1-508-530-0329, pmooney@echotx.com
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