BURNABY, BC,
July 22, 2014 /CNW/ - Welichem
Biotech Inc. (the "Company") (TSX-V: WBI) announces that it has
entered into a termination agreement with Shenzhen Celestial
Pharmaceuticals Ltd. ("Celestial") and Beijing Wenfeng Tianji Pharmaceuticals Co.,
Ltd. ("BWTP") to terminate the asset purchase agreement dated
March 26, 2013 (the "China APA")
among the parties, pursuant to which the Company agreed to purchase
the exclusive development and commercialization rights (the
"Rights") to the novel anti-inflammatory agent, WBI-1001, in
China, Taiwan, Macao
and Hong Kong.
Welichem, Celestial and BWTP have been trying to
negotiate with the relevant Chinese authorities since 2012 to
obtain approval of the China APA
as required for the transfer the Rights, however, negotiations have
been unsuccessful in this regard. The Board of Directors of
the Company determined that it would be in the best interests of
the Company to terminate the China APA in light of the fact that it
is unlikely that the China APA could ever be implemented.
The Termination Agreement provides that
Celestial and BWTP will return the $10
million payment made by Welichem pursuant to the China APA,
less an amount representing costs of the parties in seeking
regulatory approval of the China APA plus the amount of any taxes
required to be deducted.
Compulsory Acquisition Update
On July 21, 2014,
LJ Resources Co., Ltd. ("LJ") announced that it intends to exercise
its rights under the compulsory acquisition provisions in Section
300 of the Business Corporations Act (British Columbia) to acquire all of the
outstanding common shares of Welichem (the "Shares") that it does
not currently own and that it has now sent a notice of compulsory
acquisition to all remaining holders of Shares in connection
therewith. LJ also announced that it intends to take the
necessary steps to have Welichem cease to be a reporting issuer
under applicable Canadian securities laws following completion of
the compulsory acquisition.
About Welichem Biotech Inc.
Welichem Biotech Inc. is a publicly-traded
biotechnology company developing therapeutic drugs in the fields of
autoimmune diseases and cancer. For a more complete business and
financial profile of the Company, interested parties are encouraged
to visit the Company's website, www.welichem.com.
CAUTIONARY NOTE CONCERNING FORWARD-LOOKING
STATEMENTS
All statements included in this press release
that address activities, events or developments that the Company
expects, believes or anticipates will or may occur in the future
are forward-looking statements. In particular, this document
contains forward-looking information and statements regarding the
completion of the compulsory acquisition.
These forward-looking statements involve
numerous assumptions made by the Company based on its experience,
perception of historical trends, current conditions, expected
future developments and other factors it believes are appropriate
in the circumstances. In addition, these statements involve
substantial known and unknown risks and uncertainties that
contribute to the possibility that the predictions, forecasts,
projections and other forward-looking statements will prove
inaccurate, certain of which are beyond the Company's control,
including further actions or announcements of the offeror, changes
in laws and regulations, stock market volatility and obtaining
required approvals of regulatory authorities. Readers should not
place undue reliance on forward-looking statements.
There can be no assurance that
forward-looking statements or information will prove to be
accurate, as actual results and future events could differ
materially from those anticipated in such statements.
Accordingly, you should not place undue reliance on the
forward-looking statements or information contained herein.
Except as required by law, we do not expect to update
forward-looking statements and information.
Neither the TSX Venture Exchange nor its
Regulation Services Provider (as that term is defined in policies
of the TSX Venture Exchange) accepts responsibility for the
adequacy or accuracy of this release.
SOURCE Welichem Biotech Inc.