On October 24, 2008 Biotie Therapies Corp ("Biotie" or the "Company") has today entered into an agreement with privately held elbion NV to acquire its wholly-owned subsidiary elbion GmbH. In exchange Biotie will issue 46,802,967 new shares to elbion NV (the "Exchange Offer"). In connection with the Exchange Offer, certain shareholders of elbion NV have committed to invest an aggregate amount of EUR 3.3 million into the combined entity (the "Offering", together with the Exchange Offer the "Transaction"). The Transaction is subject to the necessary resolutions passed by Biotie and elbion NV shareholders at the general meetings to be held on 14 November 2008 and 10 November 2008, respectively.
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elbion GmbH is a pharmaceutical research and development company based in Radebeul, Germany, originally founded through a management buy-out from the German industrial group Degussa AG and subsequently financed by an international syndicate of venture capital investors in 2004. For further information on elbion GmbH please refer to Appendix 1.
Following the Exchange Offer, elbion GmbH will be a wholly-owned subsidiary of Biotie. The combined entity will focus on research and development of drugs for central nervous system disorders (addiction, psychotic illnesses) and inflammatory diseases (e.g. rheumatoid arthritis and psoriasis) with high unmet medical need. The combined entity will have a strong and balanced pipeline with first-in-class compounds at various stages of clinical development; many programmes have already been validated by top-tier pharma partners such as Roche, Wyeth and Lundbeck."Bringing together the outstanding pharmaceutical development capabilities and strong clinical pipelines of both companies will create a European leader in the CNS and inflammation market", said the Chairman of Biotie, Mr Juha Jouhki. Mr Luc Philips, the Chairman of elbion NV stated that "this business combination is a unique opportunity to combine complementary programmes and capabilities with sufficient financial means to reach key value inflection points".
The combined entity’s most advanced product, Nalmefene, is currently in phase III development for the treatment of alcohol addiction disorders and is already licensed to Lundbeck. Two compounds targeting inflammatory disorders are also in clinical development: (i) ELB353 is an orally available selective anti-inflammatory agent with potential application in several inflammatory indications and has completed phase I clinical development; (ii) BTT-1023, a fully human monoclonal antibody targeted against VAP-1, the combined entity’s proprietary inflammatory receptor, has recently completed a first in-man clinical study and is expected to proceed to clinical studies with repeated doses of the antibody. BTT-1023 has significant potential in treatment of inflammatory diseases such as rheumatoid arthritis and psoriasis. The combined entity is also developing Buprenorphine Depot, a next generation proprietary formulation of the leading drug for the treatment of opioid dependence; this drug is currently being prepared for clinical development. In addition, elbion GmbH’s world-class PDE-focused drug discovery platform is expected to provide a stream of further product candidates.
The combined entity’s clinical and pre-clinical pipeline has been endorsed by leading international pharmaceutical partners. elbion GmbH has entered into a licensing and collaboration agreement for the development of PDE10-inhibitors with Wyeth. This agreement contains potential milestones of up to USD 110 million as well as significant royalties on sales. Biotie has entered into a licensing agreement with Lundbeck for Nalmefene involving potential milestones of up to EUR 82 million as well as significant royalties on sales. Biotie also has option agreements with Roche for BTT-1023 and for a pre-clinical stage SSAO-inhibitor compound.