13 May 2011 10:51
BTG plc: AstraZeneca ends CM-3 development and option agreement
London, UK, 13 May 2011: BTG plc (LSE: BGC), the specialist healthcare company, announces that AstraZeneca has terminated the development and option agreement relating to CM-3, a GLP-1 analogue being developed by BTG's CellMed subsidiary for use in type 2 diabetes and other indications.
As part of BTG's acquisition of Biocompatibles in January 2011, 487 Biocompatibles shareholders elected to receive in aggregate 10,722,465 Contingent Value Notes (CVNs) providing a right to a payment of the Sterling equivalent of €0.56 per Biocompatibles share if AstraZeneca exercised its option to enter a licence agreement relating to CM-3 on the pre-agreed terms. As a result of AstraZeneca's decision to terminate the development and option agreement, it is highly unlikely that any payment will be made in relation to the CVNs. The payment obligation would only now arise if BTG enters into another form of licence, sale or other disposal of the GLP-1 asset to AstraZeneca prior to 31 December 2012. In light of AstraZeneca's decision to terminate the development and option agreement, the BTG Board does not believe that there is any realistic possibility that this will occur.
As a result of the termination of this option agreement, BTG's results for the year ending 31 March 2012 will include non-cash accounting charges in relation to the CVNs and the impairment of intangible book value ascribed to CM-3 at the time of BTG's acquisition of Biocompatibles in January 2011 totalling approximately £8m.
BTG will now review options for this programme as part of the ongoing portfolio review following the acquisition of Biocompatibles.
About BTG
BTG is an international specialist healthcare company that is developing and commercialising products targeting critical care, cancer and other disorders. The company is seeking to acquire new products to develop and market to specialist physicians, and is building a sustainable business financed by revenues from sales of its own marketed products and from royalties and milestone payments on partnered products.
For further information contact:
BTG | Financial Dynamics |
Andy Burrows, Director of Investor Relations | Ben Atwell |
+44 (0)20 7575 1741; Mobile: +44 (0)7990 530605 | +44 (0)20 7831 3113 |
Rolf Soderstrom, Chief Financial Officer | |
+44 (0)20 7575 0000 |