RNS Number : 8760C
Napo Pharmaceuticals Inc
05 September 2008
The Delisting Circular announcement for Napo Pharmaceuticals Inc released on 5 September 2008
at 15:41 under RNS No 8756C has been
re-released to facilitate onward
transmission by third party vendors.
The announcement is unchanged and is reproduced in full below.
For immediate release 5 September 2008
Napo Pharmaceuticals, Inc
("Napo" or "the Company")
Proposed delisting and cancellation of the Company's Listing and posting of a Circular and
Notice of Special Meeting of Shareholders
South San Francisco, California, 5 September 2008 Napo Pharmaceuticals, Inc., (LSE: NAPL
and NAPU) announces that a circular is being
sent to shareholders today setting out details of the proposed delisting and cancellation of
the Company's Common Shares from the Official
List together with other shareholder proposals including adoption of new Bylaws to eliminate
pre-emptive rights, authorization of an
increase in the share capital and authorizing the Board to declare a reverse stock split (all
of which are conditional up the delisting
taking effect). The circular contains a notice of a Special Meeting of Shareholders to be held
on 17 September 2008 (the "Special
Shareholders' Meeting).
The resolutions to cancel Napo's listing and amend the Bylaws to eliminate the pre-emption
rights require a 75% affirmative vote of
those Common Shares voting at the meeting. The other resolutions require only a simple
majority of the quorum. Additionally, 50% of
outstanding shares must vote in order to constitute a quorum.
The Directors of the Company have undertaken and certain of its shareholders have granted
proxies to vote in favour of the resolutions
to be proposed at the Special Shareholders' Meeting, in respect of all Common Shares that they
beneficially hold as at 5 September (the
Record Date) amounting in aggregate to 25,807,762 Common Shares, representing approximately
47.6 % of the issued and outstanding Common
Stock of the Company.
As previously announced, the Company has been in negotiations with potential corporate
partners in recent months to address the
commercialization of crofelemer. Until recently, the Company had been negotiating term sheets
with three separate potential partners but the
Company now intends to move forward with one of these partners. Consequently on 26 August
2008, the Company signed a non-legally binding
term sheet (the "Term Sheet") with a pharmaceutical company for the commercialization in North
America and Mexico of crofelemer for the
indication of chronic diarrhoea in persons living with HIV/AIDS ("CRO-HIV"). The Term Sheet
also relates to the potential commercialization
of crofelemer for adult acute infectious diarrhoea ("CRO-ID"), crofelemer for pediatric
diarrhoea ("CRO-PED") and crofelemer for diarrhoea
predominant irritable bowel syndrome ("CRO-IBS").
Under the Term Sheet it is envisaged that upon the signature of a definitive licensing
agreement, which is expected to occur in October
2008, the Partner will provide up-front funds to the Company and the Partner will subscribe
for a strategic equity interest in Napo. The
Directors believe that the likely level of the proposed up-front payment will not be
sufficient to provide sufficient capital to complete
the CRO-HIV trial. The Company therefore plans to raise additional funds through a combination
of debt, equity and additional licensing
agreements to complete the funding for the CRO-HIV trial. The Company has received indications
of interest in providing additional funds
from investors which are conditional upon, inter alia, the Cancellation and the entry into
definitive agreements with the Partner.
The Company only has sufficient funds to finance the Company's working capital
requirements into September 2008. If the Company is
unable to secure additional finance, the Directors would have to consider terminating or
suspending some or all of its drugs trials from
early October 2008. The Directors are actively negotiating with creditors to reduce and/or
delay the sums owed to the Company's creditors.If no additional funds are raised and no license/partnership agreement is signed by the
Company, then the Company may have to cease trading
in October 2008. If the Company is unsuccessful in reducing or delaying payments to its
creditors, the Company may have to cease trading
prior to October 2008. If the Company is successful in raising additional short term
financing, such eventuality may be delayed.
Nomura Code Securities Limited has resigned as the Company's broker, financial adviser and
sponsor.
A copy of the circular is available for inspection at the UK Listing Authority's Document
Viewing Facility at 25 The North Colonnade,
Canary Wharf, London E14 5HS. Copies of the circular and documents for inspection including
the proposed new Bylaws will be available for
inspection at Reed Smith Richards Butler LLP, Minerva House, 5 Montague Close, London, SE1
9BB, United Kingdom and the registered office of
Napo Pharmaceuticals, Inc., 250 East Grand Avenue, Suite 90, South San Francisco, CA 94080,
United States of America, during normal business
hours on any weekday until the conclusion of the Special Meeting of Shareholders. A copy of
the circular will also be available on the
Company's website
Sir William N. Young, Non-executive chairman commented: "Over the past year, the Directors
have been seeking efficient and cost
effective ways to raise further capital to allow the Company to continue the development of
its various projects. The Company has had
difficulty raising sufficient equity at an acceptable cost and the Directors consider that the
low market capitalization of the Company and
the low liquidity of trading in the Common Shares has made an investment in the Company
unattractive to certain investors. Further, after
careful consideration, the Board has come to the conclusion that the regulatory and financial
requirements of a listing on the Official List
are too onerous for the Company and the Company's time and money are better spent in
concentrating on progressing its clinical trials.
Consequently, the Board is of the opinion that this next stage of the Company's
development is better managed as an unlisted company. On
this basis, the Directors consider that it would be in the best interests of the Company to
seek cancellation of the Company's Common Shares
from the Official List."
Lisa A. Conte, CEO of Napo Pharmaceuticals, Inc. commented: "Our listing on the London
Stock Exchange has afforded us many benefits.However, at this time, given the costs of compliance along with the cost of raising capital on
the exchange, we believe it is in our
shareholders best interest to cancel our listing at this time and become a private company."
For more information please contact:
Napo Pharmaceuticals, Inc.
Lisa Conte, Chief Executive Officer
+001 (650) 616-1902
Charles Thompson, Chief Financial Officer
+001 (650) 616-1902
About Napo Pharmaceuticals, Inc.
Napo Pharmaceuticals, Inc. focuses on the development and commericalization of proprietary
pharmaceuticals for the global marketplace in
collaboration with local partners. Napo was founded in November 2001, and is based in
California, USA with a subsidiary in Mumbai, India.
Napo's late-stage proprietary gastro-intestinal compound, crofelemer, is in various stages
of clinical development for four distinct
product indications, including a late-stage Phase 3 program:
* CRO-HIV for AIDS diarrhea, Phase 3
* CRO-IBS for diarrhea irritable bowel syndrome (D-IBS), Phase 2
* CRO-ID for acute infectious diarrhea (including cholera), Phase 2
* CRO-PED for pediatric diarrhea, Phase 1
The FDA has granted fast-track status to CRO-IBS and CRO-HIV.
Crofelemer, a proprietary patented first in class agent, is extracted from Croton
lechleri, a medicinal plant which can be sustainably
harvested from several countries in South America. Napo has exclusive worldwide rights to
synthetic compounds in pre-clinical development
which act by the same mechanism of action. Napo also plans to develop an early clinical stage
product, NP-500, for the treatment of insulin
resistant diseases of Type II diabetes and metabolic syndrome (Syndrome X; pre-diabetic
syndrome) and has 4 issued patents for anti-cancer
agents in pre-clinical development. Napo has a plant library of approximately 2,300 medicinal
plants from tropical regions and Napo has
entered two screening relationships associated with this collection. Currently, products are
based on the chemical and biological diversity
derived from plants with medicinal properties, but future products may be in-licensed from
other sources.
Napo has partnerships with Glenmark Pharmaceuticals Limited of India and AsiaPharm Group
Ltd. of China. For more information please
visit www.napopharma.com.
This information is provided by RNS
The company news service from the London Stock Exchange
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