Biota to Acquire the Antibacterial Assets of MaxThera
News Nov 13, 2009
Biota Holdings Limited has announced the acquisition of the assets and drug development programs of MaxThera, Inc, an antibacterial drug discovery company located in Boston, USA. The acquisition is subject to the satisfaction of certain conditions which Biota anticipates will be met in the near future.
MaxThera has developed a high quality suite of validated novel bacterial targets and early stage antibacterial programs aimed at developing compounds to treat serious bacterial infections, including those that are resistant to existing antibiotics. The lead program targets inhibitors of an essential bacterial enzyme in the Coenzyme-A biosynthetic pathway. Coenzyme-A is responsible for a large number of metabolic processes in bacteria.
Biota’s Chief Executive Officer, Peter Cook, commented “This acquisition confirms Biota’s strategy to increase its portfolio of drugs in development and to expand beyond antivirals into other anti-infectives. MaxThera’s portfolio of new targets and novel inhibitor structures are highly complementary to Biota’s own innovative programs and the two organizations have very similar systems and discovery strategies.”
Under the terms of the Agreement, Biota will acquire the assets of MaxThera for US$1.2m in cash and US$300,000 in Biota shares. The shares will be issued following completion and will be released from escrow to MaxThera shareholders in two equal tranches at six and twelve months. MaxThera shareholders are also entitled to receive twelve (12) percent of all upfront and milestone payments received by Biota if the two main programs are licensed.
Biota intends to accelerate the development of the lead program and invest up to US$15 million, assuming development milestones are achieved. The investment will be in approximately equal installments over the next 3 to 5 years.
Dr Ania Knap (President and Chief Scientific Officer) and Dr Roger Frechette (Head of Medicinal Chemistry), MaxThera’s principal scientists and main shareholders, will maintain their current program involvement at the company’s facilities in Boston. Their capabilities and commitment to the program are highly valued by Biota.
In line with accepted accounting practice and Biota’s research and development policy, the majority of the upfront consideration will be expensed in the F2010 financial statements.