Somatix Therapy Corp. completed its acquisition of MerlinPharmaceutical Corp. on Tuesday, and with the purchase bolsteredits gene therapy technology base.
Merlin, based in New York with facilities in Research Triangle Park,N.C., has in vivo gene therapy programs and technology inadenoviral and adeno associated viral vectors. Merlin's foundingscientists come with the package. (See BioWorld Today, Dec. 21,1994, p. 1.)
Shareholders of the two-year-old privately held company will get 3million Somatix shares (NASDAQ:SOMA) over the next two years,or 16 percent of the Alameda, Calif., company's 18.75 millionoutstanding shares. One-quarter of the shares will be released everysix months, and half of them will be escrowed for 18 months toassure that Merlin's scientists stay on board. Any of their departureswould reduce the shares.
At Somatix's closing price of $4.25 on Monday, the deal is valued at$12.75 million. Somatix's stock closed at $4.06 per share Tuesday,down 19 cents.
Somatix said it signed exclusive long-term consulting arrangementswith the scientists, including Richard "Jude" Samulski, professor atthe University of North Carolina; adenovirus virologist ThomasShenk, a professor of molecular biology at Princeton University;Matthew During, a Yale University endocrinologist; and MichaelKaplitt, who specializes in central nervous system gene therapy atRockefeller University.
"The key to this has been to build a broad technology base, andthat's clearly the motivation behind this deal," Mark Bagnall,Somatix's chief financial officer, told BioWorld. "It allows us toleverage that technology platform for doing a number of differentcorporate partnership transactions using a wide variety of genetransfer techniques."
Bagnall said the move already has paid off in that Somatix has beenin discussions with a number of potential corporate partners since thedeal was announced in December.
The company said it will continue to develop Merlin's adenoassociated virus product for Parkinson's disease in conjunction withits own ex vivo method. n
-- Jim Shrine
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