On May 27, 2016 Thermo Fisher Scientific Inc. (NYSE:TMO), the world leader in serving science, and FEI Company (NASDAQ:FEIC), the leader in high-performance electron microscopy, reported that their boards of directors have unanimously approved Thermo Fisher’s acquisition of FEI for $107.50 per share in cash. The transaction represents a purchase price of approximately $4.2 billion (Press release, Thermo Fisher Scientific, MAY 27, 2016, View Source [SID:1234512844]).

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FEI designs, manufactures and supports high-performance electron microscopy workflows that provide images and information at micro-, nano- and picometer scales. Through its industry-leading offering, FEI enables customers across life sciences and materials science markets to make breakthrough discoveries and increase productivity. Based in Hillsboro, Oregon, FEI has more than 3,000 employees worldwide and maintains R&D, sales and manufacturing operations primarily in Europe and the U.S. The business, which had 2015 revenues of $930 million, will become part of Thermo Fisher’s Analytical Instruments Segment.

"The addition of FEI’s leading electron microscopy platform is an outstanding strategic fit with our company and will create significant value for our customers and our shareholders," said Marc N. Casper, president and chief executive officer of Thermo Fisher Scientific. "In life sciences, there is growing adoption of electron microscopy to study the structure of proteins. The technologies we gain with FEI will complement our mass spectrometry leadership, putting Thermo Fisher in the best position to capitalize on this important trend. As the unrivaled leader in life sciences, we will also be able to leverage our global scale and commercial reach to extend the use of FEI’s products within our large biopharma customer base. Finally, the transaction will be immediately accretive to our earnings and will create value for our shareholders through cost and revenue synergies."

Don Kania, president and chief executive officer of FEI, said, "We are pleased to reach this agreement with Thermo Fisher, which offers a number of important benefits to FEI shareholders, customers and employees. Our shareholders will see substantial and immediate value through the terms of this transaction. Our customers will benefit from the shared commitment Thermo Fisher and FEI have to innovation and customer service. And our employees will see new opportunities as our development and market expansion plans accelerate by being part of Thermo Fisher, a large and growing company. Fundamentally, this transaction bolsters our already strong position in the marketplace and allows us to play an increasing role in enabling our customers to accelerate breakthrough discoveries, increase productivity and provide solutions to global challenges."

Casper concluded, "We are very excited to welcome our new colleagues from FEI to the Thermo Fisher team and look forward to realizing the significant benefits of the transaction for all our key stakeholders. FEI’s commitment to R&D, strong IP foundation, and excellent services and software offerings are a great fit with our Analytical Instruments business and will create exciting new opportunities to drive growth."

Benefits of the Transaction

Leading Electron Microscopy Platform Complements Mass Spectrometry Leadership to Accelerate Advancements in Structural Biology. FEI’s high-end electron microscopes (EM) are complementary to Thermo Fisher’s mass spectrometry systems used for protein identification and characterization. FEI’s Cryo-EM technology, for example, is a disruptive technique used increasingly for the analysis of proteins in structural biology. With its global scale and commercial reach, Thermo Fisher also has the opportunity to drive the adoption of FEI’s technologies among its life sciences customers, particularly in biopharma.
Creates New Opportunities to Expand Presence in Attractive Materials Science Market. FEI brings unique imaging technologies that improve quality and productivity, and expand Thermo Fisher’s capabilities in materials science. Its 3D nano-characterization and nano-prototyping technologies, for example, are critical tools that support the growing trend toward development of devices that are increasingly smaller and more complex to manufacture. Thermo Fisher will benefit from FEI’s strong presence in the semiconductor market, creating a new growth opportunity within this customer set.
Proprietary, Global Services Business Generates High-Margin, Recurring Revenue Stream. FEI brings an industry-leading services business supported by more than 800 employees in over 20 countries, enabling customers to achieve maximum productivity from their instruments. The services business drives high-margin, recurring revenues that represent approximately 25% of total FEI sales, and will contribute to Thermo Fisher’s growing services capabilities.
Delivers Attractive Financial Benefits. The transaction is expected to be accretive to Thermo Fisher’s adjusted EPS1 by $0.30 in the first full year after close. Thermo Fisher expects to realize total synergies of approximately $80 million by year three following the close, consisting of approximately $55 million of cost synergies and approximately $25 million of adjusted operating income1 benefit from revenue-related synergies.
Approvals and Close

The transaction, which is expected to be completed by early 2017, is subject to the approval of FEI shareholders and the satisfaction of customary closing conditions, including applicable regulatory approvals. Thermo Fisher intends to use proceeds from committed debt financing and cash on hand to fund the transaction.

Advisors

JP Morgan is acting as financial advisor to Thermo Fisher, and Wachtell, Lipton, Rosen & Katz is serving as legal counsel. Goldman, Sachs & Co. is acting as financial advisor to FEI, and Wilson Sonsini Goodrich & Rosati is serving as legal counsel.

Use of Non-GAAP Financial Measures

In addition to the financial measures prepared in accordance with generally accepted accounting principles (GAAP), we use certain non-GAAP financial measures, including adjusted EPS and adjusted operating income, which exclude certain acquisition-related costs, including charges for the sale of inventories revalued at the date of acquisition and significant transaction costs; restructuring and other costs/income; and amortization of acquisition-related intangible assets. Adjusted EPS also excludes certain other gains and losses that are either isolated or cannot be expected to occur again with any regularity or predictability, tax provisions/benefits related to the previous items, benefits from tax credit carryforwards, the impact of significant tax audits or events and the results of discontinued operations. We exclude the above items because they are outside of our normal operations and/or, in certain cases, are difficult to forecast accurately for future periods. We believe that the use of non-GAAP measures helps investors to gain a better understanding of our core operating results and future prospects, consistent with how management measures and forecasts the company’s performance, especially when comparing such results to previous periods or forecasts.

On May 27, 2016 Baxalta Incorporated (NYSE: BXLT) reported the results of a vote on the proposals identified in the definitive proxy statement/prospectus, dated April 18, 2016, at a special meeting of shareholders held earlier this morning relating to the proposed combination with Shire plc (LSE: SHP, NASDAQ: SHPG) (Filing, 8-K/A [Amend], Baxalta, MAY 27, 2016, View Source [SID:1234512841]). Baxalta shareholders approved the definitive merger agreement with Shire, dated as of January 11, 2016, and the merger transaction, with approximately 76.9 percent of shares outstanding cast in favor of the proposal, which represents approximately 98.9 percent of the votes cast at the meeting.

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Earlier today, Shire shareholders of approximately 93.8 percent of the votes cast voted in favor of the adoption of the merger agreement with Baxalta. This represents approximately 75.5 percent of Shire’s total outstanding shares of common stock as of 8:00 a.m. (London time) on May 25, 2016, the record date for the special meeting.

As announced on January 11, 2016, Baxalta and Shire entered into a definitive merger agreement pursuant to which Shire would acquire Baxalta in a stock and cash transaction. Baxalta stockholder approval and Shire shareholder approval are conditions to the merger. The completion of the transaction remains subject to certain other closing conditions, but the companies expect that this transaction will be completed on or about June 3, 2016.

On May 27, 2016 Baxalta Incorporated (NYSE:BXLT) reported the results of a vote on the proposals identified in the definitive proxy statement/prospectus, dated April 18, 2016, at a special meeting of shareholders held earlier this morning relating to the proposed combination with Shire plc (LSE: SHP, NASDAQ: SHPG) (Press release, Baxalta, MAY 27, 2016, View Source [SID:1234512840]). Baxalta shareholders approved the definitive merger agreement with Shire, dated as of January 11, 2016, and the merger transaction, with approximately 98.9 percent of shares outstanding cast in favor of the proposal.

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Earlier today, Shire shareholders of approximately 93.8 percent of the votes cast voted in favor of the adoption of the merger agreement with Baxalta. This represents approximately 75.5 percent of Shire’s total outstanding shares of common stock as of 8:00 a.m. (London time) on May 25, 2016, the record date for the special meeting.

As announced on January 11, 2016, Baxalta and Shire entered into a definitive merger agreement pursuant to which Shire would acquire Baxalta in a stock and cash transaction. Baxalta stockholder approval and Shire shareholder approval are conditions to the merger. The completion of the transaction remains subject to certain other closing conditions, but the companies expect that this transaction will be completed on or about June 3, 2016.

On May 27, 2016 Can-Fite BioPharma Ltd. (NYSE MKT: CANF) (TASE:CFBI), a biotechnology company with a pipeline of proprietary small molecule drugs being developed to treat inflammatory diseases, cancer and sexual dysfunction, reported financial results for the three months ended March 31, 2016 and updates on its drug development programs (Filing, Q1, Can-Fite BioPharma, 2016, MAY 27, 2016, View Source [SID:1234512832]).

Clinical Development Program and Corporate Highlights Include:

● CF101 – Phase II Glaucoma Results Expected in June; Phase III Trials in Rheumatoid Arthritis & Psoriasis Scheduled to Commence in 2016

In June 2016, Can-Fite plans to report data from a Phase II trial of CF101, conducted by its subsidiary OphthaliX, in the treatment of glaucoma and related syndromes of ocular hypertension.

During the first quarter of 2016, Can-Fite submitted a Phase III trial protocol for CF101 in the treatment of rheumatoid arthritis to the European Medicines Agency (EMA) and is currently expecting EMA input.

On March 7, 2016, Can-Fite presented data at the American Academy of Dermatology’s 74th Annual Meeting in Washington D.C. in a poster titled, "Treatment of Plaque-type Psoriasis with Oral CF101: Data from a Phase II/III Clinical Trial." The Company plans to file a Phase III trial protocol for CF101 in the treatment of psoriasis with the EMA in the first half of 2016 and commence the study by the end of 2016.

● CF102 – Conducting Phase II Trial in Liver Cancer & Plans to Commence Phase II Trial in NASH

Can-Fite continues to enroll and dose patients in its global Phase II liver cancer study in the U.S., Europe, and Israel. Completion of enrollment with approximately 78 patients is expected in the second half of 2016. The Company is preparing to file its Phase II protocol for CF102 in the treatment of non-alcoholic steatohepatitis (NASH), with institutional review boards (IRBs) in the second quarter of 2016.

● CF602 – Reports New Pre-Clinical Data & Preparing to Submit an IND to FDA for Treatment of Sexual Dysfunction

Following the end of the first quarter, in April 2016 Can-Fite reported new data for CF602, showing a statistically significant full recovery from erectile dysfunction after one single dose treatment in a pre-clinical diabetic model.

Can-Fite plans to file an investigational new drug (IND) application with the U.S. Food and Drug Administration for a Phase I study of CF602 in the treatment of sexual dysfunction during the fourth quarter of 2016.

"During the first quarter, we made advancements in both our drugs heading into Phase III and our earlier stage indications. For CF101, we look forward to reporting data from our Phase II glaucoma trial and anticipate receiving input from the EMA on our pivotal Phase III rheumatoid arthritis trial in the coming month," stated Can-Fite CEO Dr. Pnina Fishman.

Revenues for the three months ended March 31, 2016 were NIS 0.21 million (U.S. $0.06 million). We did not record any revenues during the three months ended March 31, 2015. The increase in revenue was due to the recognition of a portion of the NIS 5.14 million (U.S. $1.36 million) upfront payment received in March 2015 under the distribution agreement with Cipher Pharmaceuticals.

Research and development expenses for the three months ended March 31, 2016 were NIS 4.08 million (U.S. $1.08 million) compared with NIS 2.33 million (U.S. $0.62 million) for the same period in 2015. Research and development expenses for the first quarter of 2016 comprised primarily of expenses associated with the Phase II study for CF102 as well as expenses for ongoing studies of CF101. The increase is primarily due to costs associated with preparations of the CF101 Phase III studies in the treatment of rheumatoid arthritis and psoriasis.

General and administrative expenses were NIS 2.36 million (U.S. $0.63 million) for the three months ended March 31, 2016 compared to NIS 2.48 million (U.S. $0.66 million) for the same period in 2015. The minimal decrease is primarily due to a reduction in professional services expenses.

Financial income, net for the three months ended March 31, 2016 aggregated NIS 0.44 million (U.S. $0.12 million) compared to financial income, net of NIS 3.3 million (U.S. $0.88 million) for the same period in 2015. The decrease in financial income, net in the first quarter of 2016 was mainly due to a smaller decrease in the fair value of warrants that are accounted as financial liability as compared to the same period in 2015. In addition, the decrease in financial income, net in the first quarter of 2016 was attributable to an increase in expenses due to exchange rate differences as compared to the same period in 2015.

Can-Fite’s net loss for the three months ended March 31, 2016 was NIS 5.79 million (U.S. $1.54 million) compared with a net loss of NIS 1.51 million (U.S. $0.40 million) for the same period in 2015. The increase in net loss for the first quarter of 2016 was primarily attributable to an increase in research and development expenses and a decrease in financial income, net.

As of March 31, 2016, Can-Fite had cash and cash equivalents of NIS 56.61 million (U.S. $15.03 million) as compared to NIS 66.03 million (U.S. $17.53 million) at December 31, 2015. The decrease in cash during the three months ended March 31, 2016 is due to operating expenses.

For the convenience of the reader, the reported NIS amounts have been translated into U.S. dollars, at the representative rate of exchange on March 31, 2016 (U.S. $1 = NIS 3.766).

The Company’s consolidated financial results for the three months ended March 31, 2016 are presented in accordance with International Financial Reporting Standards.

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INTERIM CONDENSED CONSOLIDATED STATEMENTS OF FINANCIAL POSITION
In thousands (except for share and per share data)

Convenience translation into
U.S. dollars

March 31, March 31, December 31,
2016 2016 2015
Unaudited
USD NIS

ASSETS

CURRENT ASSETS:

Cash and cash equivalents 15,032 56,610 66,026
Other receivable and prepaid expenses 1,384 5,213 2,419

Total current assets 16,416 61,823 68,445

NON-CURRENT ASSETS:

Lease deposits 7 27 27
Property, plant and equipment, net 68 254 236

Total long-term assets 75 281 263

Total assets 16,491 62,104 68,708

INTERIM CONDENSED CONSOLIDATED STATEMENTS OF FINANCIAL POSITION
In thousands (except for share and per share data)

Convenience translation into
U.S. dollars

March 31, March 31, December 31,
2016 2016 2015
Unaudited
USD NIS

LIABILITIES AND SHAREHOLDERS’ EQUITY

CURRENT LIABILITIES:

Trade payables 1,005 3,784 1,803
Deferred revenues 227 857 857
Other accounts payable 843 3,174 4,279

Total current liabilities 2,075 7,815 6,939

NON-CURRENT LIABILITIES:

Warrants exercisable into shares 3,968 14,942 16,725
Deferred revenues 910 3,427 3,641
Severance pay, net 169 636 630

Total long-term liabilities 5,047 19,005 20,996

CONTINGENT LIABILITIES AND COMMITMENTS

EQUITY ATTRIBUTABLE TO EQUITY HOLDERS OF THE COMPANY:

Share capital 1,867 7,030 7,030
Share premium 88,389 332,873 332,873
Capital reserve from share-based payment transactions 5,192 19,552 19,288
Warrants exercisable into shares (series 10-12) 2,385 8,983 8,983
Treasury shares, at cost (964 ) (3,628 ) (3,628 )
Accumulated other comprehensive loss (366 ) (1,380 ) (1,401 )
Accumulated deficit (87,267 ) (328,647 ) (322,876 )

Total equity attributable to equity holders of the Company 9,236 34,783 40,269

Non-controlling interests 133 501 504

Total equity 9,369 35,284 40,773

Total liabilities and equity 16,491 62,104 68,708

INTERIM CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS
In thousands (except for share and per share data)

Convenience translation into
U.S. dollars

Three months ended March 31,
2016 2016 2015
Unaudited
USD NIS NIS


Revenues 57 214 -

Research and development expenses 1,083 4,077 2,328
General and administrative expenses 628 2,364 2,476

Operating loss 1,654 6,227 4,804

Finance expenses 382 1,438 18
Finance income (499 ) (1,878 ) (3,316 )
Net loss 1,537 5,787 1,506

Other comprehensive loss (income):
Adjustments arising from translating financial statements of foreign operations (7 ) (26 ) 234
Total comprehensive loss 1,530 5,761 1,740

Net loss attributable to:
Equity holders of the Company 1,533 5,771 1,359
Non-controlling interests 4 16 147
1,537 5,787 1,506

Total comprehensive loss attributable to:
Equity holders of the Company 1,527 5,750 1,551
Non-controlling interests 3 11 189
1,530 5,761 1,740

Net loss per share attributable to equity holders of the Company :
Basic and diluted net loss per share 0.06 0.21 0.06