Aequus Pharmaceuticals Announces It Has Entered into a Definitive Agreement to Acquire TeOra Health and Intends to Promote Its First Commercial Product in Canada in 2015
Vancouver, BC. July 13, 2015 –
- Transforms Aequus into a commercial-stage specialty pharmaceutical company earlier than previous guidance and is expected to generate product revenue in 2015
- Adds expertise and leadership to build a Canadian sales infrastructure to support the launch of acquired/licensed products as well as Aequus’ internal programs
- Expands focus to include life-cycle patented brands, branded generic products, and reformulated novel delivery products within focused therapeutic areas
- Additional commercial products currently under negotiation
- Ian Ball, previously CEO of TeOra Health, to be named Chief Commercial Officer and Anne Stevens to be named Chief Operating Officer
Aequus Pharmaceuticals Inc. (TSX-V: AQS) (“Aequus” or “the Company”), a specialty pharmaceutical company with a focus on developing, advancing and promoting differentiated products in Canada, today announced that it has entered into a definitive agreement to acquire TeOra Health Ltd. (“TeOra”), a privately held Canadian specialty pharmaceutical company, as part of its growth strategy to build a commercial arm in Canada. Consideration for the acquisition will be in the form of 420,000 of Aequus common shares to be issued upon closing, and an additional 2,940,000 common shares which will be held in escrow and released based on the achievement of certain milestones and performance targets and additional product launches. If all milestones are met, total consideration for the acquisition will be the issuance of 3,360,000 common shares of Aequus to TeOra shareholders. Closing of the transaction is expected to occur on or before July 27, 2015.
This acquisition further strengthens Aequus’ expertise and capabilities to execute on the Company’s stated growth strategy to establish a Canadian commercial infrastructure. Since inception in 2014, TeOra has built a strong team of former pharmaceutical executives with a focus on licensing, acquiring and promoting high-quality prescription medications across Canada in focused therapeutic areas with novel delivery systems or dosages, branded generics or late life cycle patented brands. TeOra recently entered into a binding term sheet for the promotion of an ophthalmology product in Canada with promotional efforts expected to begin the second half of 2015 with net revenue potential for the combined company over $3M in 2016. TeOra is also in negotiations for multiple commercial stage products within hospital specialty markets expected to be announced by year end. Ian Ball, CEO of TeOra, will lead Aequus’ commercial efforts as Chief Commercialization Officer. Ian has over 20 years of experience in the pharmaceutical industry, with a proven track record leading multinational organizations. He is a recognized leader in life cycle management with a background in both branded and generic pharmaceuticals. Most recently as the Global Head of Brand Maximization and Life Cycle Strategy with Novartis, he was responsible for leading the organization through the recent patent losses of both Diovan ® and Gleevec ®, generating incremental value of over $400 million. Ian also led the global strategy for life-cycle management across the entire Novartis portfolio with total revenues up to $42 billion.
The first product expected to be promoted under this new commercial arm for Aequus is a branded generic. Aequus will be promoting and distributing this product, which has been approved by Health Canada, in an effort to expand its usage in Canada through a wider reach to physicians benefiting a greater number of patients. The transaction requires no upfront or milestone payments; Aequus will receive revenues based on agreed upon percentages of net sales. Further details around the product and this agreement will be announced once promotional efforts have begun. Additionally, there are multiple commercial products that are currently under negotiation within ophthalmology, CNS (central nervous system), and potentially other complimentary hospital specialty therapeutic areas.
“We created Aequus with the goal of developing reformulations of existing products that would benefit patients, without subjecting ourselves or our shareholders to the risks of traditional drug development. Our entire business to date has been focused on the life-cycle management strategy of improving the method of delivery of existing approved medicines as they come off patent; we are very excited to bring on someone like Ian who has been executing life-cycle management strategy for years with one of the largest pharmaceutical companies in the world,” said Doug Janzen, President and CEO of Aequus. “We see this as an excellent opportunity to build on TeOra’s current strategy of leveraging their relationships and insights via creative product-commercialization structures, allowing us to add a number of new revenue-generating products in the near and mid-term without having to deploy a lot of dilutive capital to outright acquire these assets.”
“This deal is a hand in glove fit for TeOra and Aequus. We both have a clear therapeutic focus within our pipelines and the phasing of our launches allows for dynamic growth within our chosen specialty areas”, said Ian Ball, CEO of TeOra. “The TeOra team and I are looking forward to the immediate future and are confident in our ability to execute on the commercialization plans for a number of already identified programs, thereby adding additional revenue generating opportunities to the combined pipeline and continuing with the innovation on established molecules that the Aequus team is already working on.”
Aequus also announced the promotion of Anne Stevens to Chief Operating Officer. Ms. Stevens has been involved with the strategic growth of Aequus as a Director and VP of Corporate Development since its inception in 2013, and will continue to be focused on product and corporate strategy across the Aequus pipeline portfolio. Ms. Stevens brings over a decade of experience in the pharmaceutical industry and is a co-founder and Senior Partner at Northview Lifesciences with a proven background in portfolio management, business development, alliance management, market research and sales.
About TeOra Health
TeOra Health Ltd. is a specialty pharmaceutical company focused on the acquisition, licensing and promotion of high quality prescription medications across Canada in ophthalmology and transplant. For further information, please visit www.teora-health.com.
About Aequus Pharmaceuticals
Aequus Pharmaceuticals Inc. (TSX-V: AQS) is a Vancouver-based specialty pharmaceutical company focused on developing, advancing and promoting differentiated
products in Canada. Aequus’ development pipeline focuses on enhancing delivery methods for approved drugs that are limited by non-compliance, high
frequency dosing, first-pass metabolism side-effects, painful injections, or where the therapeutic profile can be improved by making an alternative
delivery system available. Aequus is developing several products in neurology and psychiatry with a goal of addressing the need for improved medication
adherence through enhanced delivery systems. Aequus intends to commercialize its internal programs within Canada and to establish strategic partnerships
to accelerate and maximize the potential of its product candidates worldwide. For further information, please visit www.aequuspharma.ca.
Forward-Looking Statement Disclaimer
This release contains forward-looking statements or forward-looking information under applicable Canadian securities legislation that may not be based on historical fact, including, without limitation, statements containing the words “believe”, “may”, “plan”, “will”, “estimate”, “continue”, “anticipate”, “intend”, “expect”, “potential” and similar expressions. Forward-looking statements are necessarily based on estimates and assumptions made by us in light of our experience and perception of historical trends, current conditions and expected future developments, as well as the factors we believe are appropriate. Forward-looking statements in this release include but are not limited to statements relating to: our acquisition of TeOra, intention to launch commercial products in Canada and the implementation of our business model and strategic plans; and our ability to access capital. Such statements reflect our current views with respect to future events and are subject to risks and uncertainties and are necessarily based upon a number of estimates and assumptions that, while considered reasonable by Aequus, are inherently subject to significant business, economic, competitive, political and social uncertainties and contingencies. Many factors could cause our actual results, performance or achievements to be materially different from any future results, performance, or achievements that may be expressed or implied by such forward-looking statements. In making the forward looking statements included in this release, the Company has made various material assumptions, including, but not limited to general business and economic conditions and the availability of financing on reasonable terms. In evaluating forward-looking statements, current and prospective shareholders should specifically consider various factors set out herein and under the heading “Risk Factors” in the Company’s Long-Form Prospectus dated February 18, 2015, a copy of which is available on Aequus’ profile on the SEDAR website at www.sedar.com, and as otherwise disclosed from time to time on Aequus’ SEDAR profile. Should one or more of these risks or uncertainties, or a risk that is not currently known to us materialize, or should assumptions underlying those forward-looking statements prove incorrect, actual results may vary materially from those described herein. These forward-looking statements are made as of the date of this release and we do not intend, and do not assume any obligation, to update these forward-looking statements, except as required by applicable securities laws. Investors are cautioned that forward-looking statements are not guarantees of future performance and are inherently uncertain. Accordingly, investors are cautioned not to put undue reliance on forward-looking statements.
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