Marion Merrell Dowell Inc. (MMD) reached an agreement topurchase privately held Selectide Corp. for $58 million in cash, thecompanies said Wednesday.
Selectide, of Tucson, Ariz., is a closely held company founded in1990 that focuses on combinatorial chemistry. It will become part ofSt. Louis-based MMD's research and development operation, whileremaining in Tucson.
The deal is expected to close in about a month, said Dave Madden,Selectide's president and CEO.
Madden told BioWorld that company officials realized about 18months ago that combinatorial chemistry was drawing more andmore interest from most of the world's pharmaceutical companies.Company officials thought about collaborations before deciding thatbeing acquired was the best option.
"They [MMD] realized the importance of combinatorial chemistry,"Madden said. "They had a great deal of expertise in complementaryareas _ other high-throughput screening assays, computationalchemistry and traditional medicinal chemistry. The one componentthey needed to add was combinatorial chemistry. The fit was quitegood."
Selectide's lead compound, in preclinicals, is an inhibitor of factorXa, which may be useful for certain coagulation disorders.
"Bringing in Selectide's expertise will give us an even quicker startin research, more flexibility in exploring potential new products and,frankly, more value for our dollar than contracting with outsidecompanies for these advanced technologies," said Frank Douglas,MMD's executive vice president, research and development. "Thisalso should strengthen our relationships with emerging researchcompanies."
MMD has collaborations or agreements with a number ofbiotechnology-related companies, including Affymax NV, AlteonInc., ALZA Corp., Cortech Inc., ImmuLogic Pharmaceutical Corp.,Oncogene Science Inc., Scios Nova Inc. and Sepracor Inc. Thecompany has about 9,000 employees worldwide and had sales of$2.255 billion for the nine months that ended Sept. 30.
MMD expects to take a one-time charge of 15 cents per share at thetime of closing.
Selectide has more than 60 employees, and does its research on site.A three-year collaborative agreement signed in January 1993 withSugen Inc., of Redwood City, Calif., is expected to be terminated.That focused on developing peptide antagonists of Sugen's signaltransduction targets.
Sugen and Selectide swapped stock as part of their collaboration.Sugen said it will receive about $3 million in proceeds as a result ofits 5 percent stake in Selectide.
Madden said the small group of Selectide shareholders will realizethe profits from their sale of Sugen stock in addition to the $58million from MMD. n
-- Jim Shrine
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