BioSante Pharmaceuticals, Inc. (NASDAQ:BPAX) and Cell Genesys
(NASDAQ:CEGE), today announced that they have entered into a
definitive merger agreement by which the companies will merge in an
all-stock transaction, with BioSante as the surviving company.
Under the terms of the merger agreement, Cell Genesys
stockholders will receive 0.1615 of a share of BioSante common
stock for each share of Cell Genesys common stock they own. Based
on the companies� closing stock prices on June 29, 2009, this
represents $0.347 per share of consideration to be received by the
Cell Genesys stockholders, or a total consideration of
approximately $38 million, and a premium of 12 percent to the
closing sale price of Cell Genesys� common stock on that date. Upon
completion of the transaction, BioSante stockholders prior to the
merger are expected to own approximately 60.4 percent of the
outstanding shares of the combined company and the former Cell
Genesys stockholders are expected to own 39.6 percent.
Stephen M. Simes, president and CEO of BioSante, and Phillip B.
Donenberg, CFO of BioSante, will continue to serve in those
positions in the merged company. Dr. Louis W. Sullivan, chairman of
the board of BioSante, will continue in that position. It is
anticipated that Stephen A. Sherwin, M.D., chairman and CEO of Cell
Genesys, and John T. Potts, Jr., M.D., a current member of the Cell
Genesys board, will join the board of the merged company upon
completion of the merger.
The merged company will focus primarily on LibiGel, BioSante�s
testosterone gel in Phase III clinical development under a U.S.
Food and Drug Administration (FDA) agreed Special Protocol
Assessment (SPA) for the treatment of female sexual dysfunction
(FSD). The merged company also will seek future development
opportunities for GVAX Immunotherapies including potential
combination with BioVant�, BioSante�s vaccine adjuvant, as well as
possible external collaborations, and also will seek to outlicense
other Cell Genesys technologies. In addition, the merged company
will acquire a 16 percent equity ownership position in Ceregene,
Inc., a former subsidiary of Cell Genesys which is developing gene
therapies for neurodegenerative disorders.
�This merger allows BioSante to secure additional funding
required for the continued Phase III development of LibiGel for FSD
and offers the potential to expand our product development
portfolio with the addition of GVAX Immunotherapies,� said Stephen
M. Simes, BioSante�s president and CEO. �LibiGel remains the only
pharmaceutical product in the U.S. in active development for the
treatment of hypoactive sexual desire disorder (HSDD) in menopausal
women. We continue to believe that LibiGel can be the first product
approved by the FDA for the common and unmet medical need of FSD
with the completion of Phase III studies targeted for mid-to-late
2010. In addition, our company has had a long-standing interest in
immunotherapy based on our proprietary vaccine adjuvant, BioVant,
and we look forward to future value-creating opportunities for our
stockholders based on Cell Genesys� technologies and other
assets.�
�Over the past several months, we have had the opportunity to
evaluate a wide range of strategic alternatives for our company
including several merger opportunities. After reviewing various
strategic alternatives, engaging in discussions with a number of
other potential merger candidates and conducting extensive due
diligence on BioSante�s product development and business
activities, our board of directors has voted to recommend a merger
with BioSante,� stated Stephen A. Sherwin, M.D., chairman and CEO
of Cell Genesys. �We believe that BioSante�s lead product, LibiGel,
represents a compelling near term product opportunity with
significant upside potential. We also are impressed with BioSante�s
record of achievement including the recent launch of Elestrin�
(estradiol gel) as well as their CaP nanotechnology platform which
includes BioVant, a novel vaccine adjuvant with potential in
immunotherapy.�
The merger agreement has been approved unanimously by the boards
of directors of both BioSante and Cell Genesys and will need to be
approved by both BioSante�s and Cell Genesys� stockholders. The
merger is subject to customary closing conditions as well as a
condition requiring Cell Genesys� net cash, less certain expenses
and liabilities, to be a specified minimum amount as of 10 calendar
days prior to the anticipated closing date of the merger.
As of June 23, 2009, Cell Genesys� cash balance was
approximately $36 million and BioSante�s cash and cash equivalents
balance was approximately $6.2 million. As a result of Cell
Genesys� recently completed exchange offer, Cell Genesys has
outstanding approximately $20.8 million of new 3.125% Convertible
Senior Notes due in 2013 and $1 million of the original 3.125%
Convertible Senior Notes due in 2011.
The transaction is expected to be completed in the late third
quarter or early fourth quarter of 2009. BioSante was advised in
this transaction by Oppenheimer & Co. Inc. and Cell Genesys was
advised by Lazard.
About BioVant
An adjuvant is a substance that, when added to a vaccine,
enhances the vaccine's effectiveness by enhancing the body�s immune
response. In multiple studies, BioVant has been shown to be safe
and cause minimal dose-dependent inflammation at the injection
site, and has been shown both to prevent the manifestation of
allergic response, and, to effectively �switch off� established
Th2-T-cell-associated allergic reactions. BioVant also may permit a
reduction in the needed dosage of vaccine, thereby potentially
improving the safety profile of the vaccine.
About GVAX Immunotherapies
GVAX cancer immunotherapies are non patient-specific therapies
comprised of whole tumor cells that have been modified to secrete
GM-CSF (granulocyte-macrophage colony-stimulating factor), an
immune stimulatory cytokine, and then irradiated for safety. GVAX
is administered via intradermal injections on an outpatient basis.
To date, over 1000 patients have been treated in clinical trials
with different GVAX cancer immunotherapies for various types of
cancer. Although phase III trials in prostate cancer were
discontinued in 2008, phase II trials under physician investigator
sponsored-INDs are ongoing at the Sidney Kimmel Cancer Center at
Johns Hopkins Hospital in pancreatic cancer, leukemia and breast
cancer.
About BioSante Pharmaceuticals, Inc.
BioSante is a specialty pharmaceutical company focused on
developing products for female sexual health, menopause,
contraception and male hypogonadism. BioSante's lead products
include LibiGel� (transdermal testosterone gel) in Phase III
clinical development by BioSante under a U.S. Food and Drug
Administration (FDA) SPA (Special Protocol Assessment) for the
treatment of female sexual dysfunction (FSD), and Elestrin�
(estradiol gel) developed through FDA approval by BioSante,
indicated for the treatment of moderate-to-severe vasomotor
symptoms associated with menopause, currently marketed in the U.S.
Also in development are Bio-T-Gel�, a testosterone gel for male
hypogonadism, and an oral contraceptive in Phase II clinical
development using BioSante patented technology. The current market
in the U.S. for estrogen and testosterone products is approximately
$2.5 billion and for oral contraceptives approximately $3 billion.
The company also is developing its calcium phosphate technology
(CaP) for aesthetic medicine (BioLook�), novel vaccines and drug
delivery. Additional information is available online at:
www.biosantepharma.com.
About Cell Genesys, Inc.
Cell Genesys is headquartered in South San Francisco,
California. For additional information, please visit Cell Genesys�
website at www.cellgenesys.com.
Forward-Looking Statements
This news release contains forward-looking statements within the
meaning of the Private Securities Litigation Reform Act of 1995
about BioSante and Cell Genesys. Such statements include, but are
not limited to, statements about the proposed transaction and its
potential benefits to the BioSante and Cell Genesys stockholders,
the expected timing of the completion of the transaction, the
combined company�s plans, objectives, expectations and intentions
with respect to future operations and products and other statements
that are not historical in nature, particularly those that utilize
terminology such as �will,� �potential�, �could,� �can,� �believe,�
�intends,� �continue,� �plans,� �expects,� �estimates� or
comparable terminology. Forward-looking statements are based on
current expectations and assumptions, and entail various known and
unknown risks and uncertainties that could cause actual results to
differ materially from those expressed in such forward-looking
statements. Important factors known to BioSante and Cell Genesys
that could cause actual results to differ materially from those
expressed in such forward-looking statements include general
business and economic conditions; the failure of the BioSante or
Cell Genesys stockholders to approve the transaction or the failure
of either party to meet any of the other conditions to the closing
of the transaction; the failure to realize the anticipated benefits
from the transaction or delay in realization thereof; the
businesses of BioSante and Cell Genesys may not be combined
successfully, or such combination may take longer, be more
difficult, time-consuming or costly to accomplish than expected;
and operating costs and business disruption following the merger,
including adverse effects on employee retention and on business
relationships with third parties, BioSante�s need for and ability
to obtain additional financing, the difficulty of developing
pharmaceutical products, obtaining regulatory and other approvals
and achieving market acceptance; the marketing success of
BioSante�s licensees or sublicensees and the success of clinical
testing. Additional factors that could cause BioSante�s and Cell
Genesys� results to differ materially from those described in the
forward-looking statements can be found in BioSante�s and Cell
Genesys� most recent annual reports on Form 10-K and subsequent
quarterly reports on Form 10-Q and other filings with the
Securities and Exchange Commission, which are filed with the SEC
and available at the SEC�s web site at www.sec.gov and which
discussions also are incorporated herein by reference. The
information set forth herein speaks only as of the date hereof, and
BioSante and Cell Genesys disclaim any intention and do not assume
any obligation to update or revise any forward looking statement,
whether as a result of new information, future events or
otherwise.
Important Additional Information for Investors and
Stockholders
This communication is being made in respect of the proposed
business combination involving BioSante and Cell Genesys. In
connection with the proposed transaction, BioSante intends to file
with the SEC a registration statement on Form S-4, containing a
joint proxy statement/prospectus and other relevant materials and
each of BioSante and Cell Genesys plan to file with the SEC other
documents regarding the proposed transaction. The final joint proxy
statement/prospectus will be mailed to the stockholders of BioSante
and Cell Genesys. INVESTORS AND SECURITY HOLDERS OF BIOSANTE AND
CELL GENESYS ARE URGED TO READ THE JOINT PROXY STATEMENT/PROSPECTUS
(INCLUDING ANY AMENDMENTS OR SUPPLEMENTS) AND OTHER DOCUMENTS FILED
WITH THE SEC CAREFULLY IN THEIR ENTIRETY WHEN THEY BECOME AVAILABLE
BECAUSE THEY WILL CONTAIN IMPORTANT INFORMATION ABOUT BIOSANTE,
CELL GENESYS AND THE PROPOSED TRANSACTION.
Investors and security holders will be able to obtain free
copies of the registration statement and the joint proxy
statement/prospectus (when available) and other documents filed
with the SEC by BioSante and Cell Genesys at the SEC�s web site at
www.sec.gov. Free copies of the registration statement and the
joint proxy statement/prospectus (when available) and other
documents filed with the SEC can also be obtained by directing a
request to BioSante, Attention: Investor Relations, telephone:
(847) 478-0500 or to Cell Genesys, Attention: Investor Relations.,
telephone (650) 266-3200. In addition, investors and security
holders may access copies of the documents filed with the SEC by
BioSante on BioSante�s website at www.biosantepharma.com, and
investors and security holders may access copies of the documents
filed with the SEC by Cell Genesys� website at
www.cellgenesys.com.
BioSante, Cell Genesys and their respective directors and
executive officers and other persons may be deemed to be
participants in the solicitation of proxies from the stockholders
of BioSante and Cell Genesys in respect of the proposed
transaction. Information regarding BioSante�s directors and
executive officers is available in its annual report on Form 10-K
for the year ended December 31, 2008, filed with the SEC on March
16, 2009 and the proxy statement for BioSante�s 2009 annual meeting
of stockholders, filed with the SEC on April 27, 2009. Information
regarding Cell Genesys� directors and executive officers is
available in its annual report on Form 10-K for the year ended
December 31, 2008, filed with the SEC on March 9, 2009 and the
proxy statement for Cell Genesys� 2009 annual meeting of
stockholders, filed with the SEC on March 31, 2009. If and to the
extent that any of the BioSante or Cell Genesys participants will
receive any additional benefits in connection with the merger that
are unknown as of the date of this filing, the details of those
benefits will be described in the definitive joint proxy
statement/prospectus relating to the merger. Investors and
stockholders can obtain more detailed information regarding the
direct and indirect interests of BioSante�s and Cell Genesys�
directors and executive officers in the merger by reading the
definitive joint proxy statement/prospectus when it becomes
available.
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