Epirus grabs $36 mln Series B funds and merges with Zalicus

Epirus Biopharmaceuticals said Wednesday that it has secured $36 million in Series B funding. Livzon Mabpharm led the round with participation from other investors that include Adage Capital, Greenwoods Investment, Gibralt US, Monashee Capital Partners, TPG Biotech, Montreux Equity Partners and 5AM Ventures. Also, Epirus will merge with Zalicus. No financial terms were disclosed. The merged entity will be led by Amit Munshi as president and CEO. Based in Boston, Epirus is a biopharmaceutical firm focused on biosimilar monoclonal antibodies while Zalicus specializes in developing new treatments for patients suffering from pain and inflammation.

PRESS RELEASE

BOSTON–(BUSINESS WIRE)–Epirus Biopharmaceuticals, Inc. (Epirus), a Boston-based biopharmaceutical company focused on the global development and commercialization of biosimilar monoclonal antibodies, and Zalicus Inc. (NASDAQ:ZLCS) (Zalicus), announced today that they have entered into a definitive agreement under which Epirus will merge with a wholly-owned subsidiary of Zalicus in an all-stock transaction. Following closing, Zalicus will be re-named Epirus Biopharmaceuticals, Inc., and will operate under the leadership of the Epirus management team with Amit Munshi serving as the president and chief executive officer. In addition, Dr. Mark H.N. Corrigan will serve as chairman of the company’s board of directors, which will have representatives from both the existing Epirus and Zalicus boards.
The merger will create a Nasdaq-listed, publicly traded company focused on building a global biosimilar enterprise to improve patient access to important medicines. Epirus is currently developing a pipeline of biosimilars, including BOW015, a biosimilar to Remicade®, BOW050, a biosimilar to Humira®, and BOW030 a biosimilar to Avastin®.
Epirus also announced today that it has closed a $36 million Series B financing round led by Livzon Mabpharm, Inc. Other investors participating in this round include Adage Capital, Greenwoods Investment, Gibralt US, Inc., Monashee Capital Partners LP, and an investment affiliate of Mousse Partners, as well as existing investors TPG Biotech®, Montreux Equity Partners and 5AM Ventures.
“Under the new company structure, we will continue to aggressively advance our pipeline of biosimilars, and address diverse global biosimilar markets through local partnerships,” said Amit Munshi, president and CEO of Epirus. “Through this transaction, we gain access to additional financial resources as well as clinical trial experience in the rheumatoid arthritis space. Our combined team is committed to expanding patient access to important medications.”
Mark H.N. Corrigan, M.D., president and CEO of Zalicus, said, “We are strong believers in the upside of this newly combined company and the potential of the biosimilar space. Epirus’ strategic model and experienced management team, coupled with Zalicus’ knowledge of the rheumatoid arthritis space and global clinical development expertise, position us well to leverage our strong relationships with key opinion leaders and experience in conducting European clinical trials in RA. This merger creates a dynamic and exciting new enterprise to successfully develop and commercialize biosimilars for the global market. After an extensive review of potential merger candidates and their product pipelines, Zalicus identified Epirus as an organization with the potential to create significant value for our shareholders.”
The percentage of the combined company that Zalicus stockholders will own as of the closing of the merger is subject to adjustment at the closing based on the level of Zalicus’ net cash at the closing. On a pro forma basis, based upon the number of shares of Zalicus common stock to be issued in the merger, (i) current Zalicus stockholders will own approximately 19% of the combined company and current Epirus stockholders will own approximately 81% of the Company if Zalicus’ net cash at closing is equal to or in excess of $12 million, (ii) current Zalicus stockholders will own approximately 17% of the combined company and current Epirus stockholders will own approximately 83% of the Company if Zalicus’ net cash at closing is equal to or in excess of $9 million but less than $12 million, and (iii) current Zalicus stockholders will own approximately 14% of the combined company and current Epirus stockholders will own approximately 86% of the Company if Zalicus’ net cash at closing is equal to or less than $9 million. Zalicus is exploring different alternatives to increase its level of net cash. However, based on Zalicus’ current level of net cash and taking into account Zalicus’ projected expenses in connection with the proposed transaction, if the merger were to close today, the stockholders of Zalicus would own appropriately 14% of the combined company and current Epirus stockholders would own approximately 86% of the combined company. There can be no assurances that any actions taken by Zalicus to attempt to increase its level of net cash between now and closing will be successful or that any such alternatives are available to Zalicus.
The merger is subject to customary closing conditions, including approval of the stockholders of Zalicus and Epirus. The Boards of Directors of both Zalicus and Epirus have unanimously approved the transaction and recommended that their stockholders vote in favor of the transaction. The transaction is currently expected to close during the summer of 2014.
Leerink Partners LLC and Latham & Watkins are acting as financial and legal advisors, respectively, to Epirus and Wedbush PacGrow Life Sciences and Goodwin Procter are acting as financial and legal advisors, respectively, to Zalicus.
Conference Call Information
Epirus and Zalicus will host a conference call and audio webcast today at 8:30 a.m. EDT to discuss the merger agreement. To access the conference call, please dial 1-877-870-4263 (domestic) or 1-412-317-0790 (international) at least five minutes prior to the start time and refer to conference “Epirus and Zalicus Merger Agreement.”
To access materials that will be shared By Epirus and Zalicus during this conference call, please visit www.epirusbiopharma.com or www.zalicus.com.
An audio webcast of the call will also be available on the Investors section of the Zalicus website www.zalicus.com. An archived webcast will be available on the Company’s website approximately two hours after the event.
About EPIRUS
Epirus is building a global biosimilar enterprise to improve patient access to important medicines. The Company’s strategy for commercial success relies on targeted approaches for diverse global markets.
For emerging markets with accessible regulatory frameworks for biosimilars, Epirus develops partnerships with local companies to accelerate regulatory approval and commercialize its products.
For high-growth global markets where local manufacturing confers strategic and operational advantages, Epirus intends to use its SCALE™ platform to deliver an “In Market, For Market™” manufacturing solution with local partners.
For large markets with an established biosimilar regulatory framework, such as Europe, Epirus plans to commercialize its products using a combination of direct sales and local distributors.
More information about Epirus can be found at www.epirusbiopharma.com
About Zalicus
Zalicus Inc. (NASDAQ:ZLCS) is a biopharmaceutical company that discovers and develops novel treatments for patients suffering from pain and inflammation. Zalicus has a portfolio of proprietary clinical-stage product candidates targeting pain and has entered into multiple revenue-generating collaborations with large pharmaceutical companies relating to other products, product candidates and drug discovery technologies. Zalicus applies its expertise in the discovery and development of selective ion channel modulators and its combination high throughput screening capabilities to discover innovative therapeutics for itself and its collaborators in the areas of pain and oncology. To learn more about Zalicus, please visit www.zalicus.com.

 

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