PharmAthene Closes Strategic Equity Financing; Raises Gross Proceeds of
$13.1 Million
ANNAPOLIS, Md., Oct. 13 /PRNewswire-FirstCall/ -- PharmAthene, Inc.
(Amex: PIP), a biodefense company developing medical countermeasures
against biological and chemical threats, announced today that the Company
has closed a strategic equity financing with Panacea Biotec Ltd., (through
Panacea's subsidiary, Kelisia Holdings Ltd.) raising gross proceeds of
$13.1 million for PharmAthene.
Under the strategic financing, Panacea Biotec's subsidiary has
purchased approximately 3.73 million shares of PharmAthene common stock at
a negotiated price of $3.50 per share, which represents a 93% premium above
the closing price of PharmAthene's common stock on October 10, 2008. In
addition, Panacea Biotec's subsidiary has received 12-month warrants to
purchase up to approximately 2.75 million additional shares of PharmAthene
common stock at an exercise price of $5.10 per share.
"The equity investment by Panacea Biotec is part of a comprehensive
strategy to strengthen our balance sheet and forge a strategic alliance
with a globally recognized biopharmaceutical company," said David P.
Wright, President and Chief Executive Officer of PharmAthene. "We were
attracted to Panacea Biotec because it has distinguished itself as an
international health management company that is actively conducting
research and development of novel chemical and biological pharmaceutical
formulations and has developed a diverse proprietary product portfolio
encompassing pediatric vaccines, and therapeutics for emerging infectious
diseases and other human health needs."
"An alliance with PharmAthene presents important strategic
opportunities to create value for both of our companies," said Mr. Rajesh
Jain, Joint Managing Director of Panacea Biotec. "Panacea Biotec is
committed to identifying partners for US distribution of our products. We
recognize PharmAthene's strength in the biodefense industry and the core
competencies of its management team with respect to vaccine development and
commercialization. We are very pleased to participate in this strategic
alliance and provide strategic equity financing to PharmAthene to help the
Company further its business objectives."
The $13.1 million investment will increase PharmAthene's ongoing
product development activities, enhance working capital, and provide new
resources for corporate growth. Panacea Biotec, through its subsidiary,
currently owns approximately 14.5% of PharmAthene's issued and outstanding
common stock and, with the warrant, will have the right to purchase up to
an additional 2.75 million shares, subject to a stock ownership cap,
following any warrant exercise, of 19.99% of PharmAthene's issued and
outstanding common stock. During the next three years Panacea Biotec has
agreed not to purchase additional shares of PharmAthene stock without the
prior written consent of PharmAthene. Panacea Biotec's subsidiary will be
granted limited rights to participate in future private financings by
PharmAthene to maintain its then current ownership level. In addition,
PharmAthene will retain full rights to its proprietary information and
technology and full management and operational control.
About the Securities
The securities that are being sold in the transaction have not been
registered under the Securities Act of 1933, as amended (the "Securities
Act"), and may not be offered or sold in the United States absent
registration or an applicable exemption from the registration requirements.
PharmAthene has agreed to file a registration statement under the
Securities Act to register the shares of common stock to be issued at
closing and upon any exercise of the warrants for public resale from time
to time in the future. There can be no assurances that the registration
statement will be declared effective. The information contained in this
press release does not constitute an offer for the sale of any securities.
About PharmAthene, Inc.
PharmAthene was formed to meet the critical needs of the United States
and its allies by developing and commercializing medical countermeasures
against biological and chemical weapons. PharmAthene's lead product
development programs include:
-- SparVax(TM) - a second generation recombinant protective antigen
(rPA) anthrax vaccine
-- Third generation rPA anthrax vaccine
-- Valortim(R) - a fully human monoclonal antibody for the prevention
and treatment of anthrax infection
-- Protexia(R) - a novel bioscavenger for the prevention and treatment
of morbidity and mortality associated with exposure to chemical nerve
agents
-- RypVax(TM) - a recombinant dual antigen vaccine for plague
For more information about PharmAthene, please visit http://www.PharmAthene.com.
About Panacea Biotec Ltd.
Panacea Biotec is an Indian research-based health management company
with established research, manufacturing and marketing capabilities.
Panacea Biotec's product portfolio includes innovative prescription
products in important therapeutic areas such as pain management, diabetes
management, renal-disease management, anti-osteoporosis, anti-tubercualar,
gastro- intestinal care products, and vaccines. Panacea Biotec has
collaborations with leading Indian and international research organizations
and corporations. The Company operates manufacturing facilities and has
five research and development centers and employs approximately 3,200
employees including over 280 scientists.
Statement on Cautionary Factors
Except for the historical information presented herein, matters
discussed may constitute forward-looking statements within the meaning of
the Private Securities Litigation Reform Act of 1995 that are subject to
certain risks and uncertainties that could cause actual results to differ
materially from any future results, performance or achievements expressed
or implied by such statements. Statements that are not historical facts,
including statements preceded by, followed by, or that include the words
"potential"; "believe"; "anticipate"; "intend"; "plan"; "expect";
"estimate"; "could"; "may"; "should"; or similar statements are
forward-looking statements. PharmAthene disclaims, however, any intent or
obligation to update these forward-looking statements. Risks and
uncertainties include risk associated with the reliability of the results
of the studies relating to human safety and possible adverse effects
resulting from the administration of the Company's product candidates,
unexpected funding delays and/or reductions or elimination of U.S.
government funding for one or more of the Company's development programs,
the award of government contracts to our competitors, unforeseen safety
issues, unexpected determinations that these product candidates prove not
to be effective and/or capable of being marketed as products, as well as
risks detailed from time to time in PharmAthene's Forms 10-K and 10-Q under
the caption "Risk Factors" and in its other reports filed with the U.S.
Securities and Exchange Commission (the "SEC"). Copies of PharmAthene's
public disclosure filings are available from its investor relations
department and our website under the investor relations tab at
http://www.pharmathene.com.
SOURCE PharmAthene, Inc.
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Related links:
http://www.pharmathene.com
CONTACT:
Stacey Jurchison of PharmAthene, Inc.,
+1-410-269-2610, JurchisonS@PharmAthene.com
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