West Coast Editor
Citing the cost in manpower and money, Sonus Pharmaceuticals Inc. backed away from its planned $30 million merger with the French drug company Synt:em, disclosed late last year.
Michael Martino, president and CEO of Bothell, Wash.-based Sonus, said during a conference call that "despite the best efforts of the parties" involved, they would not be able to complete the deal by the stipulated deadline of March 31. He cited the time required for questions from the SEC regarding the proxy statement, as well as for scheduling a special shareholder meeting to approve the deal.
Sonus said it has decided instead to focus on lead candidate Tocosol Paclitaxel, an improved version of the well-known chemotherapy drug using vitamin E-based oil-in-water emulsion for delivery, which is nearing Phase III trials.
Those trials are expected to enroll about 700 evaluable patients, Martino said, which is "at the upper end of our previous guidance of between 400 and 800 patients," but is necessary to provide the statistical rigor and power that would make Sonus' compound a taxane sufficiently differentiated in the marketplace.
Sonus' shares (NASDAQ:SNUS) dipped about 9 percent Wednesday, when the decision was made public. Thursday, the stock closed at $3.28, down 7 cents.
Under the terms of the agreement with Nimes, France-based Synt:em, Sonus would have paid $10 million in stock up front, and $20 million more as development milestone payments. But both sides had the option of turning away before March 31. (See BioWorld Today, Nov. 5, 2004.)
Another option for Sonus would have been to extend the deadline to April 30 by making a €500,000 (US$668,862) loan to Synt:em, but company officials decided the best tack was to call off the deal entirely.