Mitsubishi Tanabe Pharma Identified as Lead Investor in September 2011 Equity Financing
QUEBEC CITY, March 27, 2012 /PRNewswire/ - Medicago Inc. (TSX: MDG), a biopharmaceutical company focused on developing highly effective and competitive vaccines based on proprietary manufacturing technologies and Virus-Like Particles (VLPs), announced the establishment of a strategic alliance with Mitsubishi Tanabe Pharma Corporation (MTPC) through the execution of a Master Research Collaboration Agreement on March 6, 2012. This collaboration was highlighted by Ed Fast, Minister of International Trade and Minister for the Asia-Pacific Gateway for Canada, during Canadian Prime Minister Stephen Harper's visit to Japan on March 26, 2012.
In addition to this agreement, Medicago and MTPC are pleased to now disclose that MTPC was the lead investor for Medicago's C$25 million private placement offering in September 2011. MTPC, previously identified as a Top 50 global pharmaceutical company, made a private equity investment of C$10 million in the financing, alongside other healthcare-focused investors.
The objectives of the March 2012 strategic alliance with MTPC are to develop and commercialize at least three new vaccines. MTPC will provide funding for all research and development costs. In exchange for granting licensing rights, Medicago is entitled to receive upfront and milestone payments as well as royalties for each product to be developed under this master agreement. Under this first agreement to develop a Rotavirus Like Particle (RLP) vaccine target, MTPC will have the option to license the RLP vaccine target and assume global development, regulatory and commercialization responsibilities, while Medicago is eligible to receive up to a total of C$33 million in upfront and milestone payments as well as royalties on future sales of the RLP product. Medicago will receive an upfront payment of C$3 million to begin the initial research on rotavirus. Additional targets under this master agreement are to be selected by Medicago and MTPC at a later date.
"The investment by Mitsubishi Tanabe Pharma followed by the successful execution of our strategic alliance marks the initiation of what we expect to be a long-standing and valuable partnership," said Andy Sheldon, President and Chief Executive Officer of Medicago. "We have started our work on the rotavirus VLP vaccine candidate, and look forward to announcing additional products under our collaboration in the future."
Medicago is a clinical-stage biopharmaceutical company developing novel vaccines and therapeutic proteins to address a broad range of infectious diseases worldwide. The Company is committed to providing highly effective and competitive vaccines and therapeutic proteins based on its proprietary VLP and manufacturing technologies. Medicago is a worldwide leader in the development of VLP vaccines using a transient expression system which produces recombinant vaccine antigens in plants. This technology has potential to offer more potent vaccines with speed and cost advantages over competitive technologies, enabling the development of a vaccine for testing in approximately one month after the identification and reception of genetic sequences from a pandemic strain. This production time frame has the potential to allow vaccination of the population before the first wave of a pandemic, and supply large volumes of vaccine antigens to the world market. Medicago also intends to expand development into other areas such as biosimilars and biodefense products where the benefits of our technologies can make a significant difference. Additional information about Medicago is available at www.medicago.com.
Forward Looking Statements
This news release includes certain forward-looking statements that are based upon current expectations, which involve risks and uncertainties associated with Medicago's business and the environment in which the business operates. Any statements contained herein that are not statements of historical facts may be deemed to be forward-looking, including those identified by the expressions "anticipate", "believe", "plan", "estimate", "expect", "intend", and similar expressions to the extent they relate to Medicago or its management. The forward-looking statements are not historical facts, but reflect Medicago's current expectations regarding future results or events. These forward-looking statements are subject to a number of risks and uncertainties that could cause actual results or events to differ materially from current expectations, including the matters discussed under "Risk Factors and Uncertainties" in Medicago's Annual Information Form filed on March 31, 2011 with the regulatory authorities. Medicago assumes no obligation to update the forward-looking statements, or to update the reasons why actual results could differ from those reflected in the forward-looking statements.
SOURCE Medicago Inc.