Lidak Pharmaceuticals and Biofor Inc., both saying the strategic fitwas not right, discontinued talks Wednesday that would have resultedin the acquisition of Biofor by Lidak.
Neither company would reveal the reasons for the lack of synergy.Lidak, of La Jolla, Calif., and Biofor, a Waverly, Pa., subsidiary ofAtlanta-based Scherer Healthcare Inc., entered into a non-bindingletter of intent earlier this month. (See BioWorld Today, May 9,1994, p. 1.) Lidak was to have issued up to $10 million worth of itsstock to acquire the rational drug design company.
"We continue to feel the technologies they're developing have a lotof promise," Michael Lorber, Lidak's chief financial officer, toldBioWorld. "We can't be specific about what led to our decisions,other than upon further analysis the strategic fit did not turn out asgood as we thought it might be."
Biofor's lead technology is called MultiCASE Assisted Drug Design.It uses a knowledge base of compounds with known activities togenerate biophores, which are molecule fragments likepharmacophores but enhanced with modulators to boost or inhibitactivity.
Robert Naismith, president and CEO of Biofor, told BioWorld that"we see a number of opportunities [to grow our company], whichwe're continuing to pursue." He said Scherer isn't able to provideadequate funding at this time.
"We believe our platform technology to be extremely valuable andfar-reaching, and our research programs are producing verypromising drug candidates," Naismith said. He said the company hasinvested more than $2 million in software and into its drug-designtechnology. For the past nine years, he said, Biofor has developeddata bases that allow it to look at efficacy and toxicity in thedevelopment of new chemical entities.
Lidak was looking to shore up its pipeline, and Lorber said itcontinues to be "interested in any discussions that would enhanceshareholder value." Its lead product, Lidakol, is in Phase III trials fororal herpes. The company's large multivalent immunogen cancervaccine program is expected to be in clinical testing this year, hesaid.
Lidak reported $13.5 million in cash and equivalents on March 31,with a net loss of $2.6 million for the quarter. It has about 29 millionshares outstanding. Lidak's stock (NASDAQ:LDAKA) was down 6cents per share Wednesday, closing at $3.19. n
-- Jim Shrine
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