- Plans to spin-off WF10™ and focus on generating additional revenues -
MISSISSAUGA, ON, April 16, 2015 /PRNewswire/ - Nuvo Research Inc. (TSX:NRI), a specialty pharmaceutical company with a diverse portfolio of topical and immunology products, today announced a revised strategy for the Company.
The Company has examined strategic alternatives with a view to increasing shareholder value by obtaining better recognition of: (a) the Company's revenue generating assets, which include Pennsaid® 2%, Pennsaid, Pliaglis, Oxoferin™ and the heated lidocaine/tetracaine (HLT) Patch, (b) its cash position, which as of December 31, 2014 was $58.3 million, and (c) the potential of WF10 as a treatment for allergic rhinitis.
After examining alternative structures and transactions internally, and with the assistance of outside consultants, the Company has determined that it should work towards spinning out WF10-related assets into a separate research and development (R&D) focused entity and transition Nuvo from a biotech company concentrated mainly on drug development into a more diversified, profitable, cash flow positive business. To achieve this objective, the Company plans to:
- Seek to acquire new products or businesses with a focus on those that can become accretive to Nuvo's profitability and cash flow. A process to identify and review opportunities has been commenced with the assistance of the Toronto-based, healthcare specialized investment bank, Bloom Burton & Co.;
- Maximize the value of the Pennsaid 2% franchise by out licensing its rights for available international territories; and
- Curtail R&D expenses. Beyond 2015, R&D expenditures will be reduced and limited chiefly to projects for which partners fund clinical trial costs. The major clinical programs funded by the Company planned for 2015 are:
- A new Phase 2 trial of WF10 for the treatment of allergic rhinitis (the 2015 WF10 Trial) whose design has been developed based on insights gained from the WF10 Phase 2 study whose results were announced in January 2015. If the 2015 WF10 Trial is successful, the Company plans to continue WF10 development in an independently financed entity that will include the participation of Nuvo shareholders. While Nuvo's management is optimistic that the 2015 WF10 Trial will be successful, in the event that the new study is unsuccessful the Company will discontinue WF10 development. Results of the trial are expected before the end of 2015. Details of the 2015 WF10 Trial will be announced in the coming days; and
- A Phase 3 clinical trial in Germany of Pennsaid 2% for the treatment of acute pain that will support regulatory approval applications for and out licensing of Pennsaid 2% in international jurisdictions. Commencement of the Pennsaid 2% trial, which is subject to German regulatory approval, is expected in Q2 2015 with topline results anticipated in Q4 2015. The estimated cost of the trial is CDN$1.5 million.
"We believe that execution of our strategy to spinout a new company focused on WF10 development, coupled with the pursuit of strategic transactions that build on Nuvo's base of revenue generating products will build shareholder value," said Dan Chicoine, Nuvo's Chairman and Co-CEO. "While we will consider all transaction opportunities, we are giving priority to those that can add to existing revenue streams and move Nuvo toward profitability."
The Company will provide updates as material elements described in the strategy are achieved.
About Pennsaid 2%
Pennsaid 2% is a topical product containing 2% diclofenac sodium compared to 1.5% for original Pennsaid. It is approved in the U.S. for pain of osteoarthritis (OA) of the knee(s). It is more viscous than Pennsaid, is supplied in a metered dose pump bottle and has been approved in the U.S. for twice daily dosing compared to four times a day for Pennsaid. Pennsaid 2% is protected by 7 U.S. patents that are listed in the FDA's Approved Drug Products with Therapeutic Equivalence Evaluations database or Orange Book. Pennsaid 2% has not yet received regulatory approval outside of the U.S. Patents protecting Pennsaid 2% have been issued or are pending in multiple major international territories.
WF10 is a solution containing stabilized chlorite ions that focuses on supporting the immune system by targeting the macrophage, a type of white blood cell that coordinates much of the immune system, to regulate normal immune function. WF10 is an infusion therapy currently approved only in Thailand under the name IMMUNOKINE for the treatment of post-radiation-therapy syndromes and adjunctive therapy of diabetic foot ulcers.
About Bloom Burton & Co.
Bloom Burton & Co. is a firm dedicated to accelerating returns in healthcare for both investors and companies. Bloom Burton has an experienced team of medical, scientific, pharmaceutical, legal and capital markets professionals who perform a deep level of diligence, which combined with a creative and entrepreneurial approach, assists our clients in achieving the right monetization events. Bloom Burton and its affiliates provide capital raising, M&A advisory, equity research, business strategy and scientific consulting, direct investing and company creation and incubation services. Bloom Burton & Co. Limited is a member of the Investment Industry Regulatory Organization of Canada (IIROC) and is also a member of the Canadian Investor Protection Fund (CIPF). Please visit www.bloomburton.com to learn more.
About Nuvo Research Inc.
Nuvo (TSX:NRI) is a specialty pharmaceutical company with a diverse portfolio of products and technologies. The Company operates two distinct business units: the Topical Products and Technology (TPT) Group and the Immunology Group. The TPT Group currently has four commercial products, a pipeline of topical and transdermal products focusing on pain and dermatology and multiple drug delivery platforms that support the development of patented formulations that can deliver actives into or through the skin. The Immunology Group has two commercial products, a development program for the treatment of allergic rhinitis and an immune system modulation platform that has the potential to support treatments for a broad range of immune system related disorders. For additional company information visit www.nuvoresearch.com.
Certain statements in this press release constitute forward-looking statements within the meaning of applicable securities laws. Forward-looking statements include, but are not limited to statements concerning the Company's future objectives, strategies to achieve those objectives, as well as statements with respect to management's beliefs, plans, estimates, and intentions, and similar statements concerning anticipated future events, results, circumstances, performance or expectations that are not historical facts. Forward-looking statements generally can be identified by the use of forward-looking terminology such as "outlook", "objective", "may", "will", "expect", "intend", "estimate", "anticipate", "believe", "should", "plans" or "continue", or similar expressions suggesting future outcomes or events. Such forward-looking statements reflect management's current beliefs and are based on information currently available to management. Forward-looking statements involve risks and uncertainties that could cause actual results to differ materially from those contemplated by such statements. Factors that could cause such differences include general business and economic uncertainties and adverse market conditions as well as other risk factors included in the Company's Annual Information Form dated February 19, 2015 under the heading "Risks Factors" and as described from time to time in the reports and disclosure documents filed by the Company with Canadian securities regulatory agencies and commissions. This list is not exhaustive of the factors that may impact the Company's forward-looking statements. These and other factors should be considered carefully and readers should not place undue reliance on the Company's forward-looking statements. As a result of the foregoing and other factors, no assurance can be given as to any such future results, levels of activity or achievements and neither the Company nor any other person assumes responsibility for the accuracy and completeness of these forward-looking statements. The factors underlying current expectations are dynamic and subject to change. Although the forward-looking information contained in this press release is based upon what management believes are reasonable assumptions, there can be no assurance that actual results will be consistent with these forward-looking statements. All forward-looking statements in this press release are qualified by these cautionary statements. The forward-looking statements contained herein are made as of the date of this press release and except as required by applicable law, the Company undertakes no obligation to publicly update or revise any forward-looking statement, whether as a result of new information, future events or otherwise.
SOURCE Nuvo Research Inc.