23 March 2011
Chemgenex chief executive officer Dr Greg Collier has told Biotech Daily that the Omapro data analysis is on track for the March 31, 2011 option deadlines.
Dr Collier said his company would complete the data in time for Cephalon to review it before March 31.
”We are very confident they’ll have time to make their decision by March 31,” Dr Collier said. “All is going well.”
Chemgenex has completed two phase II/III trials of Omapro for chronic myeloid leukemia, but its first application to the US Food and Drug Administration for patients with the T315I mutation was held up by the FDA’s Oncological Drug Advisory Committee requiring a specific diagnostic for the indication (BD: Apr 12, 2010).
Chemgenex agreed with the FDA to combine data from that trial along with the trial of chronic myeloid leukemia patients who had failed two or more tyrosine kinase inhibitors and reapply (BD: Jul 14, 2010).
Last year, the Pennsylvania-based Cephalon took an option on 19.9 percent of Chemgenex from existing investors, with Stragen International and Merck Santé SAS, with an additional 10 percent through a $15 million convertible note to Chemgenex at 50 cents a share (BD: Oct 22, 2010).
Conditions associated with the two separate arrangements included Cephalon waiving 10 percent a year interest charges on the note, pending shareholder approval which was achieved on December 21, 2010, thereby removing takeover provisions of the Corporations Act, should Cephalon proceed with the acquisition of the 19.9 percent from Stragen and Merck at 70 cents a share; and Chemgenex completing its data analysis before March 31, 2011.
A further incentive for Chemgenex to complete the analysis on time was that Cephalon would be entitled to redeem the notes if it wasn’t.
The option for Cepahlon to acquire the Stragen and Merck shares had a deadline of the later of March 31, 2011 and one week after the completion of data collection and analysis.
Dr Collier said that Cephalon acquiring the Stragen and Merck shares would not trigger a takeover bid under the Corporations Act because of the shareholder approval.
“Cephalon can exercise their option and that does not automatically trigger a takeover,” Dr Collier said.
Chemgenex fell 2.5 cents or 5.4 percent to 44 cents.