Pfizer’s decision to dismiss its deal with Catalyst Bio stunned Targacept, who lately entered into a merger contract with Catalyst, betting high on the success of Catalyst-Pfizer partnership.
On Monday, Pfizer Inc. declared that it is planning to dismiss the 2009 agreement between Catalyst Biosciences –a privately held company and Wyeth LLC a fully owned subsidiary of Pfizer Inc. The announcement stuns the Targacept Inc. who lately joined hands with Catalyst in a merger agreement, staking high on the achievement of Pfizer and Catalysts partnership.
The partnership between Catalyst and Wyeth LC was primarily signed in 2009 June, for working along with one another on accelerating the establishment of Catalysts’ foremost Factor Vlla product namely CB813b, to treat hemophilia and patients suffering from surgical bleeding signs. The agreement will expire in June 2015, which will return the research rights and license to Catalyst for its top most candidate product. The pharmaceutical company informed Catalyst to dismiss the license and research contract in an official letter earlier last week. It has also informed Targacept, on 1st April, regarding dismissal that will allow them to endure the clinical development of the candidate product by itself.
Targacept at the moment is now evaluating the effect that the company’s extraction from its license contract will have on its most likely merger with the Catalyst. This announcement was made on 5th March 2015 between the Targacept completely owned affiliate Catalyst and Merger Sub, which will make Catalyst a fully owned affiliate of Targacept. The new joined company will be named as Catalyst Biosciences and will contain a ticker “CBIO”, the coalition will have shareholders of catalyst possessing nearly 65% of ownership in the joined company, while the left 35% of the new company will belongs to Targacept stockholders, which will also receive in addition to the shares approximately $20 million in cash and around$37 million of dividends through “non-interest-bearing, redeemable, convertible notes.”
Although, the ending decision of the merger agreement is still looking for final consent from the shareholders of the company’s involved and also an approval from the regulatory bodies, the deal is most likely to be close in the 2nd quarter of the current fiscal year.
On Monday, Targacept Chief Executive Officer, Dr. Stephen Hill while speaking about the outcome if the dismissal of the Pfizer Inc. deal stated that the firm “is currently reviewing the implications of this event on the proposed merger. However, it is too early to know the implications of ending the Pfizer-Catalyst agreement.”
Pfizer stock stood at $34.74 after 0.29% increase on Wednesday market close. The New York City based company had 213.32 billion of market capitalization.
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