BRIDGEWATER, N.J., Dec. 10, 2013 /PRNewswire/ -- Savient
Pharmaceuticals, Inc. (NASDAQ: SVNT) ("Savient") announced today
that an agreement in principle has been reached by and among
Savient, the Official Committee of Unsecured Creditors appointed in
Savient's Chapter 11 case (the "UCC") and the Unofficial Committee
of Senior Secured Noteholders (the "Unofficial Committee" and,
together with Savient and the UCC, the "Parties"), whose members
hold approximately 90% of Savient's senior secured notes (the
"Secured Noteholders"). As part of the agreement, it is
anticipated that the UCC will withdraw its objection and consent to
entry of a final order authorizing Savient's continued use of cash
collateral (the "Final Cash Collateral Order") by the U.S.
Bankruptcy Court for the District of Delaware (the "Court"). The Parties
anticipate submitting a proposed Final Cash Collateral Order for
consideration and approval by the Court on or before the hearing to
consider the Final Cash Collateral Order, currently scheduled to
take place on December 13, 2013
(subject to such notice procedures as may be agreed by the
Parties). If entered by the Court, the proposed Final Cash
Collateral Order would, among other things, provide for the
distribution of proceeds from the sale of all or substantially all
of Savient's assets (the "Sale") and of additional amounts of cash
collateral to the Secured Noteholders promptly after the Sale
closing. The agreement further contemplates that the UCC
would waive its rights to challenge the Secured Noteholders' liens
and claims subject to the implementation of a global settlement
between Savient, the UCC and the Unofficial Committee (the
"Proposed Settlement"). The Proposed Settlement, which
remains subject to documentation and final agreement by the Parties
and is to be separately submitted for approval by the Court at a
later date, is anticipated to include the following principal terms
(but may be amended or modified by agreement of the Parties):
- $1,775,000 in cash would be used
to fund distributions to unsecured creditors under a confirmed plan
of reorganization or liquidation (the "Plan") and Court-approved
fees and expenses of the UCC's professionals;
- $100,000 in additional cash would
be used to pay the fees and expenses of the indenture trustee for
Savient's convertible notes;
- 100% of any proceeds received by Savient from a certain pending
litigation with a major distribution customer (the "Litigation")
would be used to fund distributions to unsecured creditors pursuant
to a confirmed Plan;
- If Savient's process to sell all or substantially all of its
assets results in a purchase price that exceeds $60 million (such excess amounts, the "Overbid
Amounts"), 3% of the first $10
million of any such Overbid Amounts and 4% of any additional
Overbid Amounts would be used to fund distributions to unsecured
creditors pursuant to a confirmed Plan, subject to an aggregate cap
of $750,000;
- Following the cash sweep by the Secured Noteholders under the
Final Cash Collateral Order, the amounts referred to in the first
four bullets above would be placed in a segregated account and held
in trust for the benefit of general unsecured creditors and the
Committee pursuant to the Final Cash Collateral Order;
- The Secured Noteholders would receive no distribution on
account of any unsecured deficiency claim;
- Any accounts receivable that Savient collects following the
closing of the Sale (except for any accounts receivable associated
with the Litigation) would be placed in a segregated account for
the benefit of the Secured Noteholders;
- Savient's cash collateral budget would include $25,000 per month for the UCC's counsel;
- The UCC or a chapter 7 trustee would have the right to pursue
disgorgement or lien avoidance actions against the Secured
Noteholders under certain circumstances in the event that the
Proposed Settlement were not implemented; and
- The Proposed Settlement would include customary and appropriate
release and exculpation provisions.
Additional information, court filings and other documents
related to this process, is available through Savient's claims
agent, the Garden City Group, at www.gcginc.com/cases/svnt or
866-297-1238.
Skadden, Arps, Slate, Meagher & Flom LLP and Cole, Schotz,
Meisel, Forman & Leonard P.A. are serving as the Company's
legal advisors, and Lazard is serving as its financial advisor.
Stroock & Stroock & Lavan, LLP and Pachulski Stang Ziehl
& Jones, LLP are serving as the UCC's legal advisors, and
Mesirow Financial Consulting, LLC is serving as its financial
advisor.
About KRYSTEXXA®
KRYSTEXXA® (pegloticase) is a PEGylated uric acid specific
enzyme for administration by intravenous infusion. The active
substance pegloticase is a covalent conjugate of uricase produced
by a genetically modified strain of Escherichia coli and
monomethoxypoly (ethylene glycol). KRYSTEXXA was approved in
the U.S. in September 2010. KRYSTEXXA is indicated in the U.S.
for the treatment of chronic gout in adult patients refractory to
conventional therapy. KRYSTEXXA is not recommended for the
treatment of asymptomatic hyperuricemia. KRYSTEXXA was approved by
the EMA in January 2013 to treat
severe, debilitating chronic tophaceous gout.
About Savient Pharmaceuticals, Inc.
Savient Pharmaceuticals, Inc. is a specialty biopharmaceutical
company focused on developing and commercializing KRYSTEXXA®
(pegloticase) for the treatment of chronic gout in adult patients
who do not respond to conventional therapy. Savient has exclusively
licensed worldwide rights to the technology related to KRYSTEXXA
and its uses from Duke University
("Duke"), which developed the
recombinant uricase enzyme used in the manufacture of KRYSTEXXA,
and Mountain View Pharmaceuticals, Inc. ("MVP"), which developed
the PEGylation technology used in the manufacture of KRYSTEXXA.
Each of MVP and Duke have been granted
U.S. and foreign patents disclosing and claiming the licensed
technology. Savient also owns or co-owns U.S. and foreign patents
and patent applications, which collectively form a broad portfolio
of patents covering the composition, manufacture and methods of use
and administration of KRYSTEXXA. In the U.S., Savient also supplies
Oxandrin® (oxandrolone tablets, USP) CIII and co-promotes Kineret®
(anakinra) with Swedish Orphan Biovitrum AB (Sobi). For more
information, please visit the Company's website at
www.savient.com.
Cautionary Note Regarding Forward-Looking Statements
Certain information in this press release may constitute
forward-looking statements within the meaning of the Private
Securities Litigation Reform Act of 1995. All statements contained
in this press release that are not statements of historical fact,
including statements regarding the satisfaction of conditions to
the closing of the proposed asset sale, the potential of the
proposed asset sale and the expectation that the Chapter 11 filings
will enable us to sell our assets in an orderly manner and maximize
value for our stakeholders, the necessity of bankruptcy court
approvals to conduct and complete the proposed asset sale and other
statements regarding our strategy, future operations, future
financial positions, future performance, commercialization of
KRYSTEXXA, prospects and plans and objectives of management, should
be considered forward-looking statements. We often use words such
as "anticipate," "estimate," "expect," "project," "intend," "plan,"
"believe," "may," "predict," "will," "would," "could," "should,"
"target" and similar expressions to identify forward-looking
statements. Actual results or events could differ materially from
those indicated in forward-looking statements as a result of risks
and uncertainties, including, among others, the potential
adverse impact of the Chapter 11 filings on our liquidity or
results of operations, changes in our ability to meet financial
obligations during the Chapter 11 process or to maintain contracts
that are critical to our operations, the outcome or timing of the
Chapter 11 process and the proposed asset sale, the effect of the
Chapter 11 filings or proposed asset sale on our relationships with
third parties, regulatory authorities and employees, proceedings
that may be brought by third parties in connection with the Chapter
11 process or the proposed asset sale, Bankruptcy Court approval or
other conditions to the proposed asset sale, and the timing or
amount of any distributions to the Company's stakeholders. For a
discussion of some of the additional risks and important factors
that we believe could cause actual results or events to differ from
the forward-looking statements that we make, see the sections
entitled "Risk Factors" and "Management's Discussion and Analysis
of Financial Condition and Results of Operations" in our Quarterly
Report on Form 10-Q for the quarter ended September 30, 2013. In addition, new risks and
uncertainties emerge from time to time, and it is not possible for
the Company to predict or assess the impact of every factor that
may cause its actual results or events to differ from those
contained in any forward-looking statements. Accordingly, you
should not place undue reliance on any forward-looking statements
contained in this press release. Any forward-looking statements
speak only as of the date of this press release. We undertake no
obligation to publicly update forward-looking statements, whether
as a result of new information, future events or otherwise.
SVNT — G
Contact:
John P. Hamill, Co- President and
Chief Financial Officer / Philip K.
Yachmetz, Co-President and Chief Business Officer
information@savient.com
908-864-7382
Kelly Sullivan / James Golden
Joele Frank, Wilkinson Brimmer
Katcher
212-355-4449
SOURCE Savient Pharmaceuticals, Inc.