LONDON (Alliance News) - Plethora Solutions Holdings PLC Friday said it hopes to raise around GBP15.9 million to fund the USD25 million acquisition of the royalty rights in PSD502 thus consolidating the group's intellectual property rights, as its losses widened in the first-half.
PSD502 is a topical spray for the treatment of premature ejaculation, containing lidocaine and prilocaine in a eutectic-like mixture. Plethora wants to acquire the rights from Shionogi Inc, Paul Royalty Fund Holdings Capital and Richard Henry - the original patent holder - for USD25 million which would result in the group owning exclusive rights to all future global royalties.
The company said it will fund the acquisition by way of a placing of 177.0 million new shares at 9 pence per share and 88.5 million fundraising warrants exercisable at 15 pence each. Plethora Solutions shares were quoted down 8.2% at 9.75 pence Friday afternoon.
The placing and subscription is conditional upon Plethora entering into the European licensing agreement, the cessation agreements and obtaining shareholder approval.
Plethora is in the advanced stages of agreeing a European Licensing Agreement with its European Partner, under which the Company would license the rights to commercialise PSD502 in the European Union, Russia, Turkey and North Africa to the European partner.
The conditional fundraising, if completed, will give Plethora the chance to repatriate and consolidate all the future revenue streams generated from the 'out licencing' of PSD502 on a global basis to commercial marketing partners of a potentially life-changing treatment in men's sexual health.
Plethora would retain full commercialisation rights for the rest of the World, including but not limited to North America, Latin America, the Asia Pacific region, the Middle East and Sub-Sahara Africa.
The fundraising comes on the day Plethora said its losses widened in the first half to GBP1.7 million for the six months to June 30, compared with a GBP1.1 million loss a year earlier, as research and development costs increased to GBP1.1 million, compared with GBP550,000 a year earlier.
Research and development costs increased as the company is working to establish a manufacturing line with its manufacturing partner Pharmaserve North West Ltd.
Manufacturing set up costs are expected to fall significantly following the year ended December 31, 2014, but the overall level of expenditure is expected to be maintained as the US Food and Drug Administration approval process begins to gather pace following the issue of the first manufactured batches, the company.
Looking ahead, Plethora said it is on track in relation to all its key measures as it moves along the path to establishing an approved manufacturing facility and bringing PSD502 to market.
Shares in Plethora Solutions were Friday trading 5.88% lower at 10.00 pence per share.
By Anthony Tshibangu; anthonytshibangu@alliancenews.com; @AnthonyAllNews
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