EAST RUTHERFORD, N.J., Feb. 2 /PRNewswire-FirstCall/ -- Cambrex Bio Science Walkersville, Inc., a subsidiary of Cambrex Corporation , is pleased to announce it has entered into a purchase agreement for all of the stock of Cutanogen Corporation, a privately-held biotechnology company that is focused on products used to treat patients with severe burns. The Company believes that the lead Cutanogen product PermaDerm(TM) cultured skin is the first multi-layered product that combines autologous epidermal and dermal layers of the skin in a product for severe burns that is pliable and grows with the patient, a particular advantage when a burn patient is a child. The purchase is expected to close within thirty days, subject to the completion of customary closing conditions.
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"The acquisition of Cutanogen fits perfectly with our wound care franchise and furthers our reputation in the industry as a well-rounded manufacturing partner," commented Shawn Cavanagh, Senior Vice President and General Manager, Bioproducts. "PermaDerm cultured skin will complement OrCel(R), a wound healing product from Ortec International, which we expect to market upon its anticipated regulatory approval in 2006."
He continued, "In addition to leveraging our cell therapy expertise, cGMP manufacturing capabilities and sales infrastructure, we are also working on process improvements that will make this potentially life-saving product more available for the treatment of critically burned patients."
The purchase price consists of $1.5 million to be fully paid at closing with additional purchase price payments of up to $4.8 million subject to the achievement of certain regulatory and commercial milestones. The Company expects to expense all purchase price payments prior to regulatory approval of the product as in-process R&D. The transaction is projected to be dilutive by approximately $0.15 per share in 2006 primarily due to the purchase price payments and accretive in 2007 and thereafter.
PermaDerm cultured skin was developed at the Shriners Hospitals for Children - Cincinnati and has been used to treat children with catastrophic burns. The PermaDerm cultured skin is based on technology (including know-how, trade secrets and patent rights) to which Cambrex retains exclusive commercial rights. PermaDerm cultured skin is made from a combination of the patient's own (autologous) cultured keratinocytes (from the epidermis) and fibroblasts (from the dermis), the two main cell types which together form skin, with a collagen-fibroblast implant that acts as a substrate.
Based on preliminary findings from 80 patients that have already been treated with the product and evaluated in North America, PermaDerm cultured skin appears to form permanent skin tissue that is not rejected by the patient's body. Additionally, it appears to be safe and effective, reduce donor site harvesting and provide improved pliability of the grafted skin. This improvement is strongly related to the presence of dermis (the lower layer of the skin) in PermaDerm(TM) cultured skin.
PermaDerm cultured skin has been given a Humanitarian Use Designation (HUD) by the US Food and Drug Administration (FDA) for the treatment of third degree burns covering 50% or greater of the patient's body. The Company anticipates applying for a Humanitarian Device Exemption (HDE) with the FDA by mid-2006. Under the HDE, Cambrex can begin providing the product to critically injured patients and be reimbursed for the cost of manufacturing and distribution.
Cambrex intends to begin a pivotal trial for PermaDerm cultured skin by the end of 2006. The trial is estimated to take approximately fifteen months. Upon completion of the analysis of the pivotal trial data, the Company expects to submit the results to the FDA in its application for Premarket Approval (PMA) for commercial sale. A PMA is the FDA process of scientific and regulatory review to evaluate the safety and effectiveness of Class III medical devices.
The current standard of care for patients with third degree burns on more than 50% of their body is the repeated use of split thickness skin autografts. The burned tissues are surgically removed (excised) and a thin layer of skin is taken from a healthy part of the body (the donor site) and applied to part of the excised areas. Those areas that are excised but for which no skin is available (because of the limited availability of donor sites) are temporarily covered with a synthetic skin replacement material or skin from a skin bank, until the previously used donor sites have healed and can be reused again. In cases of extensive burns, the same donor site has to be used over and over again which lengthens the patient's recovery time and increases the risk of infection. Donor sites may also cause serious morbidity, heal poorly and leave serious scars.
The treatment process with PermaDerm cultured skin begins when a sample of the burn victim's healthy skin is biopsied and cultured. PermaDerm cultured skin is then manufactured from the cultured cells. As soon as the sheets of PermaDerm cultured skin begin to form skin barrier (typically about 4 weeks), they can be surgically applied on the excised wounds and are expected to reduce the overall time for full coverage.
Forward Looking Statements
This news release contains "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995 and Rule 3b-6 under The Securities Exchange Act of 1934, including, without limitation, statements regarding expected performance, especially expectations with respect to sales, research and development expenditures, earnings per share, capital expenditures, acquisitions, divestitures, collaborations, or other expansion opportunities. These statements may be identified by the fact that words such as "expects," "anticipates," "intends," "estimates," "believes" or similar expressions are used in connection with any discussion of future financial and operating performance. The forward-looking statements contained herein are based on current plans and expectations and involve risks and uncertainties that could cause actual outcomes and results to differ materially from current expectations including but not limited to, global economic trends, pharmaceutical outsourcing trends, competitive pricing or product developments, government legislation and/or regulations (particularly environmental issues), tax rate, technology, manufacturing and legal issues, changes in foreign exchange rates, performance of minority investments, un-collectable receivables, loss on disposition of assets, cancellation or delays in renewal of contracts, lack of suitable raw materials or packaging materials, the possibility that the value of the acquisition of PermaDerm cultured skin may not be realized or that our plans to obtain a Humanitarian Device Exemption, completion of clinical trials and commercialization of PermaDerm cultured skin in the United States may not be successful, and the Company's ability to receive regulatory approvals for its products.
For further details and a discussion of these and other risks and uncertainties, investors are cautioned to review the latest Cambrex Annual Report on Form 10-K, including the Forward-Looking Statement section therein, and other filings with the Securities and Exchange Commission. The Company undertakes no obligation to publicly update any forward-looking statement, whether as a result of new information, future events or otherwise.
About Shriners Hospitals for Children - Cincinnati
Shriners Hospitals for Children - Cincinnati is a regional referral hospital providing acute and rehabilitation care for burned children. Primary service area is a 1,000-mile radius of Cincinnati. Shriners is one of 22 hospital of the Shriners Hospitals for Children system, a network of hospitals offering orthopedic, spinal cord, and burn injury care to children. No payment is ever sought or received from the family, the US government or any payor for services in Shriners hospitals. Shriners Hospitals for Children - Cincinnati is proud to have met the following standards of excellence in pediatric burn care and transport: 1) Verified as a Burn Center, American College of Surgeons and the American Burn Association, 2) Accredited as an Air Medical Service, the Commission on Accreditation of Air Medical Services, and 3) Accredited with Commendation, Joint Commission on Accreditation of Healthcare Organizations.
About Cambrex
Cambrex is a global, diversified life sciences company dedicated to providing products and services to accelerate and improve the discovery and commercialization of human therapeutics. The Company employs approximately 1900 worldwide. For more information, please visit http://www.cambrex.com/.
OrCel(R) is a registered trademark of Ortec International.
