Chemex Pharmaceuticals Inc. is selling its share in its lead drugcandidate for $2.5 million, which the company hopes will buy itenough time to land a merger partner.
Chemex, of Fort Lee, N.J., said Thursday it exercised its option tosell its 50 percent share in Amlexanox to former joint venture partnerBlock Drug Co. Inc., of Jersey City, N.J. The sale of rights to thedrug will be voted on by Chemex shareholders at a meeting expectedto be held in August.
Amlexanox, a 5-lipoxygenase inhibitor, is under FDA review as atreatment for aphthous ulcers, or canker sores. It has been classifiedby the agency for priority review since there are no approvedtreatments for aphthous ulcers, said Len Stigliano, chief financialofficer of Chemex.
Chemex and Block Drug ended their 1991 joint venture earlier thisyear, with all products except Amlexanox reverting to Chemex.Before the 1991 agreement, Block Drug got rights to marketChemex's Actinex, which is approved to treat pre-malignant skinlesions.
Chemex earlier said it had enough money to last through June. Blockagreed to advance Chemex $250,000 as a bridge financing until theshareholder meeting.
Stigliano said the $2.5 million payment for Amlexanox would giveChemex enough money to last for nine to 12 months. Chemex alsowould get royalties after Amlexanox sales reach $25 million. Thecompany has stopped development of all compounds except EPC-K1,a non-steroidal anti-inflammatory agent that links vitamins C and E.The compound is in Phase I/II trials for atopic dermatitis.
"We've been pursuing a merger strategy," Stigliano told BioWorld."We're looking for a strategic partner interested in dermatology thathas some financial wherewithal."
Chemex was founded on an extract from the creosote bush, whichgrows in the Southwest and is the active ingredient in many of thecompany's drugs (not EPC-K1, which was licensed from Japan-basedSenju Pharmaceuticals). Chemex has 10 employees and about 8.8million shares outstanding. n
-- Jim Shrine
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