- Nuvo shareholders to receive shares of both
companies
- One company would be a profitable and growing commercial
business
- One company would be a biotech company focused on drug
development
MISSISSAUGA, ON, Sept. 15, 2015 /CNW/ - Nuvo Research Inc.
(TSX:NRI) (Nuvo or the Company), a specialty pharmaceutical company
with growing revenues and a diverse portfolio of topical and
immunology products, today announced that it plans to split Nuvo
into two separate, publicly traded companies. This strategy
is intended to enhance long-term value for Nuvo shareholders.
If completed, the proposed transaction is expected to have the
following benefits:
- Creates a pure-play commercial healthcare company with
growing revenue, significant EBITDA and significant EBITDA growth
potential – to be owned 100% by Nuvo shareholders
- Creates a pure-play biotech development company with a deep
pipeline of product candidates and significant capital – also to be
owned 100% by Nuvo shareholders
- Both companies will be distinct and separately traded public
companies
- Nuvo shareholders to receive shares of both
companies
- Substantial, existing cash balance puts both companies in a
strong position for growth
- Provides a better mechanism for shareholders to measure the
performance of the distinct, separate businesses
"We have carefully evaluated whether to separate these
businesses for some time due to the major differences between our
specialty pharma business that generates cash and our drug
development business that utilizes cash while creating value by
advancing drug product candidates through the clinical and
regulatory process," said John
London, Nuvo's President and Co-Chief Executive
Officer. "We believe this is the right time to separate the
businesses because of the significantly improved revenue we are
beginning to receive as a result of Horizon's success in selling
Pennsaid 2% in the U.S. and the opportunity to make Pennsaid 2% a
global brand through international out-licensing or other
monetization strategies. This is a further refinement to the
strategy that we announced in our business update press release of
April 16, 2015 and is a more
definitive path to unlock value for our shareholders."
"While both businesses have significant value, they have
distinctly different business models, capital requirements and
talent needs," added Dan Chicoine,
Nuvo's Chairman and Co-Chief Executive Officer. "In addition,
their respective opportunities differ substantially in regulatory
approval requirements, length to inflection points and possible
risks and potential returns. This transaction, if completed,
would give both businesses greater flexibility to focus on, and
pursue, their respective growth strategies, which we believe should
provide shareholders with greater value over the longer term.
This separation will create greater clarity not just to our
shareholders, but also to potential strategic partners that want to
evaluate business opportunities with Nuvo."
Nuvo's product portfolio includes Pennsaid® 2%,
approved in the U.S. for pain of osteoarthritis (OA) of the
knee(s), WF10™, an immune modulating drug candidate currently being
studied in a Phase 2 study for the treatment of allergic rhinitis,
as well as the topical and transdermal development stage drug
candidates at various stages of development, which include the
Heated Lidocaine/Tetracaine Patch (HLT Patch) for the treatment of
acute musculoskeletal pain, Flexicaine for the treatment of
diabetic neuropathy and post herpetic neuralgia, IBUFOAM, an
ibuprofen foam formulation for the treatment of acute pain and
antifungal formulations for the treatment of onychomycosis.
Complete details of the proposed transaction and each company
will be set forth in an information circular that will be mailed to
Nuvo's shareholders in connection with a special meeting that will
be called by Nuvo to approve the proposed transaction.
Completion of the proposed transaction is subject to certain
conditions, including final approval by the Nuvo Board of
Directors, confirmation of the potential tax-free nature of the
transaction for Canadian and U.S. shareholders, regulatory
approval requirements and the approval of Nuvo's
shareholders. If approved by shareholders, Nuvo expects the
proposed transaction would be completed in early 2016 (subject to
the satisfaction of all conditions). However, there can be no
assurances regarding the ultimate timing of the proposed
transaction or that the proposed transaction will be completed.
Nuvo has engaged Bloom Burton & Co. as its financial advisor
and Goodmans LLP as its legal counsel in connection with the
proposed transaction.
Management to Host Conference Call/Webcast
Management
will host a conference call to discuss the proposed transaction
tomorrow (Wednesday, September 16,
2015) at 8:30 a.m. ET.
To participate in the conference call, please dial 1 (888)
231-8191 or (647) 427-7450, reference number 37788703. Please
call in 15 minutes prior to the call to secure a line. You will be
put on hold until the conference call begins.
A taped replay of the conference call will be available two
hours after the live conference call and will be accessible until
September 23, 2015 by calling 1 (855)
859-2056 or (416) 849-0833, reference number 37788703.
A live audio webcast of the conference call will be available
through www.nuvoresearch.com. Please connect at least 15 minutes
prior to the conference call to ensure adequate time for any
software download that may be required to hear the webcast.
About Nuvo Research Inc.
Nuvo (TSX:NRI) is a growing
specialty pharmaceutical company with a diverse portfolio of
products and technologies for pain and topical indications.
Nuvo's products range from U.S. Food and Drug Administration
(FDA) approved commercial products to development stage drug
candidates and technology platforms. For additional company
information visit www.nuvoresearch.com.
About Pennsaid 2%
Pennsaid 2% is a topical product
containing DMSO and 2% diclofenac sodium compared to 1.5% for
original Pennsaid. It is approved in the U.S. for pain of OA
of the knee(s). It is more viscous than Pennsaid, is supplied
in a metered dose pump bottle and has been approved in the U.S. for
twice daily dosing compared to four times a day dosing for
Pennsaid. Pennsaid 2% is protected by multiple U.S. patents
that are listed in the FDA's Approved Drug Products with
Therapeutic Equivalence Evaluations database or Orange Book.
Patents protecting Pennsaid 2% have been issued or are
pending in multiple major international territories. Pennsaid
2% has not yet received regulatory approval outside of the U.S.
To support regulatory approval in certain international
jurisdictions, Pennsaid 2% is currently being studied in a Phase 3
clinical trial in Germany for the
treatment of acute ankle sprains. Top-line results are
expected to be available in Q4 2015 or Q1 2016.
About Pennsaid
Pennsaid is used to treat the signs and
symptoms of OA of the knee(s). The drug combines a
transdermal carrier (containing DMSO) with 1.5% diclofenac sodium,
an NSAID and delivers the active drug through the skin directly to
the site of inflammation and pain. Following FDA approval of
Pennsaid 2%, Pennsaid is no longer marketed in the U.S. effective
January 1, 2015. It is
currently marketed in Canada by
Paladin Labs Inc. and marketed under license and/or distribution
agreements in Greece, Italy and the U.K.
About WF10
WF10 is a solution containing stabilized
chlorite ions that focuses on supporting the immune system by
targeting the macrophage, a type of white blood cell that
coordinates much of the immune system, to regulate normal immune
function. WF10 is an infusion therapy currently approved only
in Thailand under the name
IMMUNOKINE for the treatment of post-radiation-therapy syndromes
and adjunctive therapy of diabetic foot ulcers. WF10 is
currently being studied in a Phase 2 clinical trial for the
treatment of patients with allergic rhinitis. Top-line
results are expected to be available in Q4 2015 or Q1 2016.
About the HLT Patch
The HLT Patch is a topical
patch that combines lidocaine, tetracaine and heat, using
proprietary CHADD™ technology. The CHADD unit generates
gentle heating of the skin and in a well-controlled clinical trial
demonstrated that it contributes to the efficacy of the HLT
Patch. The Company is developing the HLT Patch for the
treatment of acute musculoskeletal pain.
About Flexicaine
Flexicaine is a proprietary cream
formulation of lidocaine and tetracaine that is designed for the
topical treatment of pain conditions such as post herpetic
neuralgia or diabetic neuropathy. The formulation dries to
form a film which can be easily peeled from the skin once actives
have been delivered to the site of pain providing a long-lasting
anesthetic effect and simple removal of the product.
About IBUFOAM
IBUFOAM was developed to treat acute and
chronic pain conditions such as sprains and strains and OA.
IBUFOAM is a topical ibuprofen foam formulation that combines a
transdermal carrier DMSO with 5% of the NSAID ibuprofen and
delivers the active drug through the skin directly to the site of
inflammation and pain.
Forward-Looking Statements
Certain statements in
this press release constitute forward-looking information and/or
forward-looking statements (collectively, forward-looking
statements") within the meaning of applicable securities
laws. Forward-looking statements include, but are not limited
to, statements concerning the potential spin-off of Nuvo's drug
development business, the benefits of the spin-off to Nuvo's
shareholders and to each company, the taxable nature of the
spin-off, the expected financial results and condition of each
company, each company's future objectives and strategies to achieve
those objectives, the future prospects of each company as an
independent company, as well as statements with respect to
management's beliefs, plans, estimates, and intentions, and similar
statements concerning anticipated future events, results,
circumstances, performance or expectations that are not historical
facts. Forward-looking statements generally can be identified
by the use of forward-looking terminology such as "outlook",
"objective", "may", "will", "expect", "intend", "estimate",
"anticipate", "believe", "should", "plans", "potentially" or
"continue", or similar expressions suggesting future outcomes or
events. Such forward-looking statements reflect management's
current beliefs and are based on information currently available to
management. Forward-looking statements involve risks and
uncertainties that could cause actual results to differ materially
from those contemplated by such statements. Factors that
could cause such differences include general business and economic
uncertainties and adverse market conditions, uncertainties that may
delay or negatively impact the spin-off or cause the spin-off to
not occur; uncertainties related to each company's ability to
realize the anticipated benefits of the spin-off, including new
focus and anticipated growth; disruptions to operations as a result
of effecting the spin-off; risks and uncertainties related to
obtaining approvals, rulings and consents, or satisfying other
requirements, necessary or desirable to permit or facilitate
completion of the spinoff future factors that may arise making it
inadvisable to proceed with, or advisable to delay, all or part of
the spin-off, the impact of the spinoff on the trading prices for,
and market for trading in, the shares of each company, as well as
other risk factors included in the Company's Annual Information
Form dated February 19, 2015 under
the heading "Risks Factors" and as described from time to time in
the reports and disclosure documents filed by the Company with
Canadian securities regulatory agencies and commissions. This
list is not exhaustive of the factors that may impact the Company's
forward-looking statements. These and other factors should be
considered carefully and readers should not place undue reliance on
the Company's forward-looking statements. As a result of the
foregoing and other factors, no assurance can be given as to any
such future results, levels of activity or achievements and neither
the Company nor any other person assumes responsibility for the
accuracy and completeness of these forward-looking statements. The
factors underlying current expectations are dynamic and subject to
change. Although the forward-looking information contained in this
press release is based upon what management believes are reasonable
assumptions, there can be no assurance that actual results will be
consistent with these forward-looking statements. All
forward-looking statements in this press release are qualified by
these cautionary statements. The forward-looking statements
contained herein are made as of the date of this press release and,
except as required by applicable law, the Company undertakes no
obligation to publicly update or revise any forward-looking
statement, whether as a result of new information, future events or
otherwise.
SOURCE Nuvo Research Inc.