SYDNEY--(BUSINESS WIRE)--Cellmid Limited (ASX:CDY) today announced that it will acquire Advangen Inc., Japan (Advangen), the Company that owns the FGF-5 inhibitor hair growth technology. Cellmid already markets the successful évolis® hair product range, which was originally derived from this technology, outside of Japan on behalf of Advangen. This is a highly strategic acquisition that will significantly increase Cellmid’s revenues in the short to medium term.
Under the terms of the agreement Cellmid will acquire 100% of the shares of Advangen in a deal involving the payment of JPY120M (AU$1.2M) in cash and the issuing of 55,737,624 shares at a nominal issue price of 5 cents each. All of the shares will be subject to voluntary escrow agreements for up to 12 months.
The deal gives Cellmid full ownership of the FGF-5 inhibitor technology platform, which underpins the Company’s existing successful évolis® hair product range and is the basis of other Advangen Inc. brands generating solid revenues in Japan. The acquisition also has important strategic benefits for Cellmid, which will gain immediate access to the established Japanese hair growth market. New market opportunities will also be pursued including China where import permits are already in place for the Lexilis® and Jo-Ju® branded products.
One of the institutional investors participating in the deal is the Tokyo based venture capitalist, Biotech Healthcare Limited Partners. Director, Dr Takeo Matsumoto, welcomed the deal and said:
“We have been very impressed by Cellmid’s progress with évolis® on the Australian market and are happy to be invested in Cellmid shares.”
Cellmid CEO, Maria Halasz, commented:
“This is a game changing deal. Our objective is to establish Cellmid as a global leader in scientifically and clinically validated hair growth technology. We plan on generating substantial revenues in the next three to five years.”
The market for hair loss products is US$1-2 billion annually in the USA alone, affecting 52 million patients (US Department of Health and Human Services, 2009). The global market is estimated to be several times this amount. There is an outstanding potential for Cellmid’s clinically proven FGF-5 inhibitor product range to gain a significant share of this market.
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About Cellmid Limited (ASX:CDY)
Cellmid is an Australian biotechnology company developing innovative novel therapies and diagnostic tests for inflammatory diseases, heart attack and cancer. Cellmid holds the largest and most comprehensive portfolio of intellectual property related to midkine and midkine antagonists globally. Through its subsidiary, the Company acquired exclusive rights in certain territories to a range of hair growth products utilising FGF-5 inhibition technology. The products have since been successfully listed with the TGA and launched on the Australian pharmacy market. The Company intends to expand the distribution of these products internationally in the future by the acquisition of Advangen Inc.
