JERUSALEM, July 7, 2015 /PRNewswire/ --
Oramed Pharmaceuticals Inc. (NASDAQ: ORMP) (http://www.oramed.com), a clinical-stage pharmaceutical company focused on the development of oral drug delivery systems, announced today that it has signed a non-binding Letter of Intent (LoI) for an investment and license agreement in China with Sinopharm Capital Management Co. Ltd. and Hefei Life Science & Technology Park Investments and Development Co., Ltd. (Sinopharm/Hefei) potentially valued at $50,000,000 plus royalty payments. Oramed will receive $500,000 in exchange for exclusively negotiating with Sinopharm/Hefei for 60 days, while the final terms of the agreement are negotiated and finalized.
The transaction which additionally includes 10% royalties on sales, will allow Sinopharm/Hefei to purchase a roughly 10% stake in Oramed Pharmaceuticals and acquire rights for oral insulin in China. The terms are to be broken down as follows: Oramed will sell Sinopharm/Hefei 1,155,367 shares of common stock for approximately $12,000,000. In addition, Oramed's wholly owned subsidiary, Oramed Ltd, will license to Sinopharm/Hefei the exclusive rights to ORMD-0801, oral insulin capsule in China, for a total amount of $38,000,000, of which $18,000,000 will be paid upon the signing of the license agreement and the remaining $20,000,000 will be paid following the completion, and release of results, of Oramed's current Phase IIb trial in the United States.
China National Pharmaceutical Group Corporation (Sinopharm), is the largest medical and healthcare group in China which is directly managed by the State-owned Assets Supervision and Administration Commission of the State Council (SASAC), with the core businesses of distribution, logistics, retail, scientific research and manufacture of healthcare related products. Sinopharm owns 11 wholly owned or holding subsidiaries, and 6 listed companies. The sales revenue of Sinopharm exceeded $39 billion in 2014. Sinopharm Capital Management Co. Ltd. is a professional asset management company within Sinopharm.
Hefei Life Science & Technology Park Investments and Development Co., Ltd.'s (HLST) business focus includes industrial investment and incubation services; high-tech product R&D; technology transfer and related consulting services. HLST has state of the art insulin production facilities in Hefei, China.
About Oramed Pharmaceuticals
Oramed Pharmaceuticals is a technology pioneer in the field of oral delivery solutions for drugs currently delivered via injection. Established in 2006, Oramed's Protein Oral Delivery (POD[TM]) technology is based on over 30 years of research by top scientists at Jerusalem's Hadassah Medical Center. Oramed is seeking to revolutionize the treatment of diabetes through its proprietary flagship product, an orally ingestible insulin capsule (ORMD-0801). Having completed multiple Phase IIa clinical trials, the company has started its Phase IIb on type 2 diabetes under an Investigational New Drug application with the U.S. Food and Drug Administration. In addition the company is developing an oral GLP-1 analog capsule (ORMD-0901).
For more information, the content of which is not part of this press release, please visit http://www.oramed.com
Forward-looking statements: This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 and other federal securities laws. Words such as "expects," "anticipates," "intends," "plans," "believes," "seeks," "estimates" and similar expressions or variations of such words are intended to identify forward-looking statements. For example, we are using forward-looking statements when we discuss the transactions pursuant to the LOI signed with Sinopharm/Hefei, including our expectation to sell shares for approximately $12,000,000 and to enter into a license agreement. The LOI with Sinopharm/Hefei is non-binding and the sale of the shares and the execution of the license agreement are subject to negotiation of definitive documentation that may be delayed or may not occur. In addition, even if the license agreement is executed, $20,000,000 of the payments thereunder is subject to achievement of milestones that may not occur. Further, we and Sinopharm/Hefei may not succeed in the commercialization of our products and even if our products are commercialized, they may not be sold in China for various reasons and therefore we may not receive any royalties on such products. Further, when we discuss revolutionizing the treatment of diabetes with our products, we are also using forward-looking statements. These forward-looking statements are based on the current expectations of the management of Oramed only, and are subject to a number of factors and uncertainties that could cause actual results to differ materially from those described in the forward-looking statements, including the risks and uncertainties related to the progress, timing, cost, and results of clinical trials and product development programs; difficulties or delays in obtaining regulatory approval or patent protection for our product candidates; competition from other pharmaceutical or biotechnology companies; and our ability to obtain additional funding required to conduct our research, development and commercialization activities. In addition, the following factors, among others, could cause actual results to differ materially from those described in the forward-looking statements: changes in technology and market requirements; delays or obstacles in launching our clinical trials; changes in legislation; inability to timely develop and introduce new technologies, products and applications; lack of validation of our technology as we progress further and lack of acceptance of our methods by the scientific community; inability to retain or attract key employees whose knowledge is essential to the development of our products; unforeseen scientific difficulties that may develop with our process; greater cost of final product than anticipated; loss of market share and pressure on pricing resulting from competition; laboratory results that do not translate to equally good results in real settings; our patents may not be sufficient; and finally that products may harm recipients, all of which could cause the actual results or performance of Oramed to differ materially from those contemplated in such forward-looking statements. Except as otherwise required by law, Oramed undertakes no obligation to publicly release any revisions to these forward-looking statements to reflect events or circumstances after the date hereof or to reflect the occurrence of unanticipated events. For a more detailed description of the risks and uncertainties affecting Oramed, reference is made to Oramed's reports filed from time to time with the Securities and Exchange Commission.
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SOURCE Oramed Pharmaceuticals Inc.