Insmed Incorporated and Transave, Inc. Announce Business Combination
Under the terms of the merger agreement,
Transition logistics for the combined company, which are expected to be completed in the first quarter of 2011, are already underway. The combined company will be governed by a four person Board of Directors with three directors remaining from the
Transave was backed by multiple well-known biotechnology venture capital funds, including Quaker BioVentures, Fidelity Biosciences,
Transave's lead product candidate, ARIKACE™ (liposomal amikacin for inhalation), is initially being developed for cystic fibrosis (CF) patients with Pseudomonas lung infections and lung infections due to non-TB Mycobacteria (NTM). The combined company intends to initiate phase 3 clinical trials for ARIKACE™ in both indications in parallel during the second half of 2011. The results of these trials are expected in the first half of 2013, and will be followed by regulatory filings in the U.S. and
Transave, which holds worldwide rights to ARIKACE™, was previously granted orphan drug status for the drug candidate from the
ARIKACE™ has the potential to be differentiated from other marketed drugs for the treatment of chronic lung infections due to its ability to deliver high, sustained levels of amikacin directly to the lung, providing sustained improvement in lung function. ARIKACE™ has been shown to improve lung function both during and between treatment periods in patients with cystic fibrosis and could potentially be the first inhaled antibiotic to be administered once-daily.
ARIKACE™ will be administered once daily via inhalation using an optimized, investigational eFlow® Nebulizer System (
"We believe this transaction has the potential to create substantial shareholder value," said Dr.
"I'm excited about the opportunity presented by combining the strengths of Transave and
"I'm looking forward to working with the new board and our employees to continue the development of ARIKACE™ with a goal of commercialization," said
The development of
- The Series B Conditional Convertible Preferred Stock issued in connection with the transaction is non-voting and will convert into shares of
Insmedcommon stock upon the approval of Insmed's shareholders. Insmedexpects to file a proxy statement with respect to the conversion of the Series B Conditional Convertible Preferred Stock with the Securities and Exchange Commissionin the first half of 2011. Immediately following such approval, the Series B Conditional Convertible Preferred Stock will convert into Insmedcommon stock at a conversion rate of one-to-one, subject to adjustment. The conversion rate will increase in the event that there are accrued but unpaid dividends on the Series B Conditional Convertible Preferred Stock at the time of conversion.
- The Series B Conditional Convertible Preferred Stock, if not converted, will receive dividends at a rate of 12.5% per annum starting the earlier of (i) the one-year anniversary of the closing of the transaction and (ii) the first date upon which at least 50 patients have been given at least one dose in Phase III clinical trials for ARIKACE™, but in no event less than nine months from the closing of the transaction. These dividends may be paid in cash or stock at
- As part of this transaction, Insmed has paid off Transave's existing debt facility of
The webcast will be archived for 30 days, and a telephone replay of the call will be available for seven days, beginning today at
About eFlow® Technology and PARI Pharma
ARIKACE™ is delivered by an investigational eFlow® Nebulizer System developed by PARI Pharma and optimized specifically for ARIKACE™. The investigational eFlow Nebulizer System uses eFlow Technology to enable highly efficient aerosolization of medication including liposomal formulations via a vibrating, perforated membrane that includes thousands of laser-drilled holes. Compared to other nebulization technologies, eFlow Technology produces aerosols with a very high density of active drug, a precisely defined droplet size, and a high proportion of respirable droplets delivered in the shortest possible period of time. eFlow Technology is not an ultrasonic nebulizer technology. Combined with its quiet mode of operation, small size (it fits in the palm of the patient's hand), light weight, and battery use, eFlow Technology reduces the burden of taking daily, inhaled treatments. PARI Pharma focuses on the development of aerosol delivery devices and comprehensive inhalation drug development to advance aerosol therapies where drug and device can be optimized together. Online at www.paripharma.com.
This release contains forward-looking statements which are made pursuant to provisions of Section 21E of the Securities Exchange Act of 1934. Investors are cautioned that such statements in this release, including statements relating to expectations regarding the anticipated benefits of the business combination, the results of clinical trials, the development of the combined company's products, the anticipated shareholder vote and the business strategies, plans and objectives of management, constitute forward-looking statements which involve risks and uncertainties that could cause actual results to differ materially from those anticipated by the forward-looking statements. The risks and uncertainties include, without limitation, we may be unsuccessful in integrating the operations of the combined company, we may be unsuccessful in developing our product candidates, our expenses may
be higher than anticipated and other risks and challenges detailed in our filings with the
The issuance of the securities in the transactions described in this press release have not been registered under the Securities Act of 1933, as amended (the "Securities Act"), or any state securities laws and may not be offered or sold in
Investor Relations Contact:
Brian Ritchie - FD
Irma Gomez-Dib - FD
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