Avigen, Baxter, MediciNova deal

MediciNova disclosed that it made an unsolicited offer to acquire Avigen for 1.8 million shares and a convertible security equal to Avigen's net cash, less $7 million that would go to MediciNova. The shares are worth $2.8 million based on MediciNova's close of $1.60 on Dec. 22, the last trading day before the bid was announced. Avigen said it expects to begin 2009 with $56 million in cash. After the deal closes, the security would convert into cash or shares of MediciNova at $4. If the security is not converted into cash, the cash would be sequestered until the later of March 31, 2010, or 12 months from the closing of the merger. Avigen said it will consider the proposal after the new year.

The company's sole clinical compound is ibudilast ( AV411), a glial attenuator that suppresses IL-1 beta, TNF alpha and IL-6, which is in a Phase IIa trial to treat opioid withdrawal symptoms. The company restructured in October and returned to Sanochemia Pharmazeutika AG (Xetra:SAC, Vienna, Austria) its rights to tolperisone ( AV650), which failed a Phase IIb trial to treat spasticity associated with MS. Earlier in December, Avigen sold its AV513, a non-anticoagulant sulfated polysaccharide (NASP) in preclinical testing to treat hemophilia, to Baxter International Inc. (NYSE:BAX, Deerfield, Ill.) for $7 million. Avigen, which announced plans to sell the compound as part of a November restructuring, said the sale to Baxter would allow the company to focus on neurology (see BioCentury, Nov. 10, 2008). ...