Nicholas Piramal wraps up BioSyntech buyout

Nicholas Piramal India (NPIL) has closed the private placement of 7,500,000 common shares at Canadian $0.80 a share in BioSyntech, a Canada-based biotechnology company specialising in discovery and development of therapeutic thermogels for regenerative medicines.

The company has informed that in accordance with the agreements between the two, NPIL has nominated its chief scientific officer, Somesh Sharma, to be its representative on the board of BioSyntech.

Commenting on the appointment of Sharma in the BioSyntech board, NPIL chairman Ajay Piramal said that it was an evidence of the company's strong interest in the development of BioSyntech's products and in future co-operations based on their technological platforms.

The acquisition is a strategic fit for NPIL and Sharma's many years of experience with biotech companies in North America will be an important asset for BioSyntech.

He added that the financing by NPIL gives BioSyntech sufficient funds to reach all of their fiscal year 2006 targeted clinical trial milestones.

In accordance with the rules of the TSX Venture Exchange, Canada , the shares issued to NPIL would be subject to a minimum holding period of four months. NPIL's post-issue shareholding would be approximately 17 per cent of BioSyntech's issued shares.

As part of the arrangement, NPIL has acquired exclusive rights for marketing, sales and distribution of current and future products of BioSyntech for India, Pakistan , Sri Lanka, Bangladesh , Laos, Cambodia , Vietnam and Philippines.

In addition, the companies have agreed to explore opportunities to collaborate for research and development with respect to future products of NPIL using BioSyntech's technological platforms.

The agreements provide that for so long as NPIL shall be the registered holder of at least 5,000,000 shares of BioSyntech, the board of BioSyntech shall include representatives of NPIL in proportion to its shareholding, subject to a minimum of one director.

In addition, Nicholas Piramal would have proportional pre-emptive rights in the event the company offers further equity securities and, until 23 February, 2006, a veto right over issuances of shares below CDN$0.80. The agreements also confer on NPIL certain rights of first refusal, piggyback rights and drag along rights.