CeNeS Pharmaceuticals plc ("CeNeS" or "the Company"): Proposed
The Company is pleased to announce that it proposes to raise approximately £6.1 million (before expenses) by means of a placing ("the Placing") of 5,789,137 new ordinary shares (the "Placing Shares") of 30 pence each ("New Ordinary Shares") at 105 pence per share. The placing price of 105 pence per share, reflects the proposed 30 for one consolidation of the ordinary share capital of the Company. The Directors intend to use the net proceeds of the Placing to prepare for Phase III studies of its lead drug M6G (morphine-6-glucuronide) in the United States and to carry out clinical trials of its other products, further details of which are set out below. The Placing is conditional, inter alia, on the passing of the necessary resolutions at an Extraordinary General Meeting of the Company ("the EGM") to be held on 22 August 2007. The Company will also hold its Annual General Meeting on the same date.
Background to the Placing
CeNeS recently announced positive results from the largest ever European Phase III trial of M6G, its lead drug candidate for the treatment of post-operative pain. The trial demonstrated that M6G gives equivalent pain relief to the "gold standard" treatment regimen of morphine and also that M6G gives a clinically relevant reduction in side effects such as nausea, dry retching, vomiting and sedation. CeNeS now intends to find partners to complete the clinical package that is required for US and European product filings. CeNeS is actively pursuing partners for M6G and maintaining momentum in the planning of the US trials will assist greatly in this process.
CeNeS has other clinical programmes that are currently not being prioritised. CNS 5161, a novel drug for the treatment of intractable chronic pain, has already been successfully tested in Phase IIa trials in neuropathic pain and is partnered for clinical development purposes with Ergomed. CeNeS and Ergomed have developed a clinical development plan to test CNS 5161 in two Phase II studies in cancer pain and neuropathic pain respectively. CeNeS is also currently completing the pre-clinical package for its novel short-acting sedative CNS 7056 and plans to file an IND application and carry out proof of concept Phase I trials.
The Directors believe that the progress of the Company's products is promising and that they are well positioned in its chosen markets. CeNeS intends to use the funds raised from the Placing as follows:
* Complete preparation for two US Phase III trials for M6G. * Complete the IND - opening Phase I pharmacokinetic study for M6G. * Complete two Phase II studies with CNS 5161. * Carry out transdermal patch formulation development for CNS 5161. * Complete a Phase I proof of concept study with CNS 7056. * Progress the early stage discovery programme in COMT inhibitors. * General working capital.
The Company's strategy remains primarily focused on further clinical development of its later-stage product portfolio candidates, being M6G and CNS 5161.
The Directors believe that the further successful development of M6G and CNS 5161 will significantly add to the value of the Group's product pipeline. Further programme development will also enable partnership of these products at a later stage in the product development cycle, thereby potentially enabling CeNeS to secure improved milestone and royalty rates in any future partnership agreements with pharmaceutical companies. The Directors further believe that development of the Group's pre-clinical products will provide CeNeS with a broader platform from which to build a focused, sustainable and profitable business. In addition, a stronger balance sheet will enable the Directors to negotiate from a better position should merger and acquisition opportunities arise and will also greatly assist in negotiations with potential licensing partners.
Indeed, the Company anticipates that it will shortly be completing a licensing deal for one of its products. The terms of the deal are in a standard format and include milestones and royalties.
Neil Clark, CEO of CeNeS, commented:
"We are delighted with the support from existing and new investors for the Placing, and the Company is now well funded as we continue our partnering discussions. These funds allow the Company to prepare for Phase III studies of its lead drug M6G in the United States and to carry out clinical trials for the remainder of the portfolio."
Consolidation of Share Capital
The Company's share register currently records over 5,000 shareholders. The cost in maintaining the register and posting documentation to this large shareholder base is both unduly expensive and time consuming. Accordingly, at the forthcoming EGM, the Company proposes to consolidate every 30 existing ordinary share of 1 pence ("Existing Ordinary Share") each into one new ordinary share of 30 pence each.
Management Participation in the Placing
Of the Placing Shares issued, the following have been placed with Directors and senior management.
Director New Ordinary Total Percentage of Shares Shareholding enlarged subscribed for on Admission ordinary share capital held Alan Goodman 9,523 542,365* 2.60* Neil Clark 9,523 28,673 0.12 Ronald Irwin 4,762 20,648 0.10 Alan Smith 4,762 4,762 0.02 Gavin Kilpatrick 2,857 15,079 0.07
Total 31,427 611,527 2.91
Note:* 4,638,176 Existing Ordinary Shares (representing 154,605 New Ordinary Shares) are held by ATM Investments Limited, a company of which Mr Goodman is a director. In addition, Mr Goodman is a director and limited partner of Avlar Bioventures Limited ("Avlar"). Avlar has an interest in 26,807,760 Existing Ordinary Shares (representing 893,592 New Ordinary Shares).
Application will be made for the Placing Shares to be admitted to trading on AIM and it is anticipated that dealings will commence in these shares on 23 August 2007. The Placing Shares and the New Ordinary Shares will, when issued, be credited as fully paid and rank pari passu in all respects with the existing issued ordinary shares in the capital of the Company.
EXPECTED TIMETABLE OF PRINCIPAL EVENTS
Latest time and date for receipt of Forms of 10.00 am on 20 August Proxy for the EGM 2007 Latest time and date for receipt of Forms of 10.30 am on 20 August Proxy for the AGM 2007 Extraordinary General Meeting 10.00 am on 22 August 2007 Annual General Meeting 10.30 am on 22 August 2007* Record Date for the Consolidation 22 August 2007 Admission and commencement of dealings in the 23 August 2007 Placing Shares on AIM
Commencement of dealings in the New Ordinary Shares on AIM 23 August 2007
Delivery in CREST of Placing Shares to be held 23 August 2007 in uncertificated form Despatch of share certificates for Placing By 31 August 2007 Shares to be held in certificated form
*Or as soon therafter as the EGM has been concluded or adjourned.
CeNeS Pharmaceuticals plc Neil Clark 01223 266 466
JM Finn Geoff Nash/Sam Smith 020 7638 9688
Financial Dynamics Ben Brewerton/Emma Thompson 020 7831 3113
J.M. Finn & Co Ltd is nominated adviser and broker to the Company for the purpose of the AIM Rules. J.M. Finn & Co Ltd, which is authorised and regulated in the United Kingdom by the Financial Services Authority and is a member of the London Stock Exchange, is acting exclusively for the Company in relation to the Placing. J.M. Finn & Co Ltd is not acting for any other person in connection with the matters referred to in this announcement and will not be responsible to anyone other than the Company for providing the protections afforded to clients of J.M. Finn & Co Ltd or for giving advice in relation to the matters referred to in this announcement.
This announcement has been issued by the Company and is the sole responsibility of the Company. This announcement has not been approved by J.M. Finn & Co Ltd for the purposes of section 21 of the Financial Services and Markets Act 2000 (as amended).
This announcement does not constitute or form part of any offer or invitation to sell or issue, or any solicitation of any offer to purchase or subscribe for, any securities or any offer or invitation to sell or issue, or any solicitation of any offer to purchase or subscribe for, such securities by any person in any circumstances, and in any jurisdiction, in which such offer or solicitation is unlawful. Accordingly, copies of this announcement are not being and must not be mailed or otherwise distributed or sent in or into or from the United States, Canada, Australia or Japan or any other jurisdiction if to do so would constitute a violation of the relevant laws of, or require registration thereof in, such jurisdiction or to, or for the account or benefit of, any United States, Canadian, Australian or Japanese person and any person receiving this announcement (including, without limitation, custodians, nominees and trustees) must not distribute or send it in or into or from the United States, Canada, Australia or Japan.
The press release can be downloaded from the following link:
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CeNeS Pharmaceuticals Plc
WKN: 913665; ISIN: GB0002070505;
Listed: Freiverkehr in Börse Berlin Bremen, Freiverkehr in Frankfurter Wertpapierbörse;