Orchid pays $3mn to buy out US-based Bexel

Orchid pays $3mn to buy out US-based Bexel

Our Web Bureau / Mumbai July 31, 2006

Chennai-based pharma company Orchid Chemicals & Pharmaceuticals (Orchid) today announced that it was consolidating its new drug discovery (NDD) research activities under a common umbrella by hiking its stake in US-based Bexel Pharmaceuticals Inc from 74% to 100%.

According to a release issued by Orchid today, the arrangement involves buy-out by Orchid of the shareholding of the US founders of Bexel Pharmaceuticals for a cash consideration of $3 million.

"The founders and key employees of Bexel would be granted 6,50,000 stock options as per standard Orchid ESOP guidelines, which they will subscribe at the grant price. In an independent arrangement, Bexel would be providing an earn-out to the principal founder of Bexel in the event of an out-licensing deal for BLX-1002 materialising in a prescribed time frame based on the Phase-II clinical trials that are planned," the release added.

While Bexel has been focusing on drug discovery research in metabolic diseases (such as diabetes, obesity and auto-immune diseases), Orchid has been focusing on inflammation, cancer and anti-infective areas.

"Bexel