A Medical Device Daily
Covalent Group (Wayne, Pennsylvania), which designs and manages complex clinical trials and patient disease registries for the pharmaceutical, biotechnology and medical device industries, reported that it has entered into a definitive “combination agreement“ with Remedium (Espoo, Finland).
Remedium is a privately held, full-service clinical research organization (CRO) based in Finland with offices in eight countries throughout Scandinavia, Central and Eastern Europe.
Upon closing, the combined company will be renamed Encorium BioSolutions .
Covalent said it expects to pay $20 million for all of the outstanding shares and common stock equivalents of Remedium. The consideration for the transaction is expected to be in the form of Covalent shares in the amount of $16 million and $4 million in cash, subject to certain purchase price adjustments.
The closing is expected to occur at the end of 2Q06 subject to certain contingencies including, but not limited to, approval by Covalent's shareholders and a scheduled new fundraising to help finance the transaction.
Covalent will apply for a new ticker symbol in connection with the name change and said it expects that the combined company will continue to be listed on the Nasdaq Small Cap market subsequent to the closing.
The goal for Encorium is to become a global leader in the design and management of complex clinical trials and patient registries for the pharmaceutical, biotechnology, and medical device industries. The company intends to accomplish this goal by further expanding its service offerings to cover the biopharmaceutical product development value chain.
Encorium will be headquartered at Covalent's present location in Wayne, and have its European base of operations in Espoo. It will have about 220 employees based in North America, Scandinavia and throughout Europe.
Boston Scientific (Natick, Massachusetts) and Guidant (Indianapolis) reported that the Securities and Exchange Commission has declared their registration statement related to the proposed $27.2 billion merger effective.
The joint proxy statement/prospectus contained in the registration statement was being mailed to Boston Scientific and Guidant shareholders on Friday, and the companies will hold their respective special meetings of shareholders on March 31 to vote on the proposed merger.
The merger is subject to customary closing conditions, including clearances under the Hart-Scott-Rodino Antitrust Improvements Act and the European Union merger control regulation, as well as approval of Boston Scientific and Guidant shareholders.
In other dealmaking news:
• Upstream Biosciences (Vancouver, British Columbia), formerly known as Integrated Brand Solutions , said it has completed the acquisition of all of the common shares of Upstream Canada .
Upstream Canada researches and develops genetic diagnostic markers for use in determining a patent's susceptibility to specific diseases and predicting a patient's response to drugs.
The transaction was completed on March 1, pursuant to the closing of an amended and restated share exchange agreement among the company, Upstream Canada and the shareholders of Upstream Canada.
The company acquired all of the 6 million issued and outstanding common shares of Upstream Canada in exchange for the issuance of 24 million shares of the company's common stock to the shareholders of Upstream Canada.
As a result of the transaction, Upstream Canada is now a wholly owned subsidiary of Upstream Biosciences.
As of March 1, the company had 44.3 million shares of common stock issued and outstanding. The former shareholders of Upstream Canada hold 24 million shares of the company's common stock, representing about 54.2% of the issued and outstanding shares.
As part of the transaction, Joel Bellenson and Dexster Smith were appointed to the company's board of directors. Additionally, Bellenson was appointed CEO and Smith was named president. Steve Bajic resigned as president but remains as a director and the secretary and treasurer of the company.
• Orion HealthCorp (Roswell, Georgia) reported that it has completed the sale of its equity interests in two ambulatory surgery centers in Houston.
The company completed the sale of its interests in SurgiCare Memorial Village to First Surgical Memorial Village , and in San Jacinto Surgery Center , to San Jacinto Methodist Hospital .
“These transactions are consistent with our commitment to focus on the growth and development in the physician business services sector, including revenue cycle management and outsourcing,“ said Terrence Bauer, CEO of Orion. “Despite our efforts to improve the financial performance of the surgery centers that comprised the core of SurgiCare's operations, this line of business did not meet expectations.“
He added that rather than allow this to continue to be a distraction, the company made the decision to sell the facilities to parties “whose core business supports the operation of surgery centers. We believe that the staff, patients and Houston marketplace served by these two surgery centers will benefit under the experienced ownership of their new management.“
In its continuing efforts to improve its balance sheet, the company also reported that it has negotiated a “significant discount“ on $750,000 of long-term debt, which it intends to retire by March 31.
Orion HealthCorp provides complementary business services to physicians through three business units: Integrated Physician Solutions, providing business and management services to physician practices; Medical Billing Services, providing physician billing and collection services and practice management solutions to hospital-based physicians; and SurgiCare, providing management services to the freestanding ambulatory surgery center market.