21 Mar 2017 07:00
For immediate release | 21 March 2017 |
ALLIANCE PHARMA PLC
("Alliance" or the "Company")
Settlement Agreement with Sinclair Pharma plc
Alliance Pharma plc (AIM: APH), the specialty pharmaceutical company, announces today it has reached agreement with Sinclair Pharma plc ("Sinclair", AIM: SPH) for compensation in connection with the material reduction of business in Kelo-stretch™, as noted on 7 April 2016 in the Company's Preliminary Results for the year ended 31 December 2015.
Kelo-stretch, a dermocosmetic cream for the prevention and treatment of stretch marks, was acquired from Sinclair in December 2015 as part of the Company's acquisition of Sinclair's Healthcare Products Business.
The terms of the agreement are:
· £4 million in cash to be paid to the Company by Sinclair on or before 30 April 2017;
· £1 million in cash to be paid to the Company by Sinclair on or before 30 June 2018; and
· Sinclair relinquishes any and all rights to Flammacerium™ (US) with immediate effect and transfers them to the Company.
The cash element of the compensation will be used by the Company to reduce its current bank loans.
Alliance continues to progress its project to register Flammacerium in the United States and plans to seek registration guidance from the US regulatory authority in the second half of 2017. As part of the acquisition of the healthcare products from Sinclair, Sinclair had retained some royalty rights on the potential US commercialisation. These rights are now being transferred to the Company. In Europe, Flammacerium is indicated as a topical treatment for severe burn and wound management.
John Dawson, Alliance Pharma's Chief Executive, said: "We are very pleased to reach this agreement with Sinclair to address the previously announced sales shortfall of Kelo-stretch. We believe the cash compensation of £5 million is fair and that the US rights to Flammacerium provide us with an additional potential opportunity which we are currently exploring. Overall, the acquisition of Sinclair's Healthcare Products Business in December 2015 has been transformational for Alliance, bringing some key growth products into the Company's portfolio and increasing our scale and international reach."
Certain information contained in this announcement would have constituted inside information (as defined by Article 7 of Regulation (EU) No 596/2014) prior to its release as part of this announcement.
For further information:
Alliance Pharma plc | + 44 (0) 1249 466966 |
John Dawson, Chief Executive Andrew Franklin, Chief Financial Officer |
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Buchanan | + 44 (0) 20 7466 5000 |
Mark Court / Sophie Cowles / Jane Glover |
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Numis Securities Limited | + 44 (0) 20 7260 1000 |
Nominated Adviser: Michael Meade / Freddie Barnfield |
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Corporate Broking: James Black / Toby Adcock |
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Notes to editors:
About Alliance Pharma
Alliance, founded in 1998, is an international speciality pharmaceutical company based in Chippenham, Wiltshire, UK. The Company has sales in more than 100 countries worldwide via direct sales, joint ventures and a network of distributors. Alliance has a strong track record of acquiring the rights to established niche products and it currently owns or licenses the rights to approximately 90 pharmaceutical and consumer healthcare products. The Company continues to explore opportunities to expand its product portfolio.
Alliance joined the AIM market of the London Stock Exchange in December 2003 and trades under the symbol APH.