MedImmune Inc. is acquiring Melville Biologics from the NewYork Blood Center for $40 million in newly issued shares ofMedImmune common stock.
The purchase gives MedImmune five Melville products:MelATE, a Factor VIII clotting agent marketed since 1991 fortreatment of hemophilia; albumin, marketed for regulatingblood volume; MelPLAS, a virus-inactivated plasma fortransfusion for which Melville filed a product licenseapplication (PLA) in February; MelGAM, a virus-inactivated,intravenous immune globulin used to treat immunodeficiencies,for which a PLA is expected to be filed later this year; andMelGLU, a virus-inactivated thrombin preparation for surgicalwound healing that is now in preclinical development.
In addition, MedImmune (NASDAQ:MEDI) will also receive aten-year right of first offer to license and develop anytechnology evolving from the New York Blood Center's LindsleyF. Kimball Research Institute.
The purchase through a stock transaction leaves MedImmune'scash resources undepleted; they now total $50 million,according to a company spokesperson. The company raised $21million last month through the private placement of 1.12million shares of newly-issued stock with a number ofinstitutional investors.
Vector Securities International Inc. commented: "We believethis transaction, valued at approximately one-times this year'sprojected revenues, will be break-even on an operating basis in1995 and anti-dilutive thereafter. As such, it makes strategicand financial sense for the company, and represents a positivestep forward in MedImmune's ongoing development."
Melville Biologics, based in Melville, Long Island, manufacturesand commercializes all blood derivative products and relatedtechnologies developed by the New York Blood Center.MedImmune, of Gaithersburg, Md., already has an agreementwith Melville for the production of its Respivir once thepolyclonal antibody product is approved by the FDA.MedImmune filed a PLA for Respivir for prevention ofrespiratory syncytial virus (RSV) infection in certain high-riskinfants in January. The product was scheduled to come up forreview by FDA's Blood Products Advisory Committee on Sept.23. But on Sept. 1, the company announced that FDA hadpostponed the review because it needed more time to analyzeRespivir data.
Once approved, Respivir will be MedImmune's second productto reach the market, following Cytogam, a polyclonal antibodyproduct used to prevent cytomegalovirus in kidney transplantpatients. Melville has provided raw materials to MedImmune'scontract manufacturer of Cytogam. MedImmune noted that italso expects approval of Zosyn, an antibiotic the companyacquired from American Cyanamid in July. A PLA for theproduct was filed in August 1991.
In addition to the $40 million MedImmune is paying in stockfor Melville, the company will also reimburse the New YorkBlood Center up to $4 million in cash for certain investments inthe division prior to the acquisition, including reimbursementfor anticipated investments in working capital and specificcapital improvements. MedImmune will also pay the BloodCenter a $1 million contingent milestone payment and royaltieson sales of certain products using technology licensed from theBlood Center.
The letter of intent for the acquisition was approved by theboard of MedImmune and a special committee of trustees ofthe New York Blood Center. It is subject to negotiation andexecution of definitive agreements and is expected to becompleted by the end of the year.
The stock gained 50 cents Tuesday, closing at $20.50.
-- Brenda Sandburg News Editor
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