4D pharma plc (AIM: DDDD), a pharmaceutical company focusing on the development of live biotherapeutics, is pleased to announce that it has acquired the production assets of Instituto Biomar, S.A. ("Biomar"), a Spanish based contract research organisation specialising in microbial fermentation.
4D has recognised that as our live biotherapeutics continue their rapid development, and more programmes move towards the clinic, there is a lack of pharmaceutical grade facilities capable of producing live biotherapeutics at both clinical and production scale. In addition, 4D has encountered a number of constraints, both in terms of size of the facilities and the availability of those facilities, in working with contract research organisations. 4D believed working solely with third party providers was no longer optimal given the number of programmes within the 4D pipeline and the current speed of development.
Biomar, based in León in north-west Spain, has been working as an outsourced development partner since 2014.
Formed in 1996, Biomar had initially focused on research into marine microorganisms and their use in pharmaceutical, bio-energy and food production. In 2001 it began to expand its technologies into microbial fermentation, providing contract services in this field and expanding its production capabilities up to 3,000 litres in 2010.
4D has been working with Biomar on several development projects generated by the MicroRx platform, as well as providing a secondary or back up facility for both the Thetanix and Blautix programmes. The facilities and experience of the team at Biomar have the capability to translate research programmes from our laboratories through clinical development to support initial production requirements. The work to date has shown the flexibility of the facility and the team at Biomar and, with the potential to expand the facility further, 4D made the decision to acquire Biomar's production assets.
The transaction will see 4D Pharma León, S.L.U. ("4D León"), a newly incorporated Spanish subsidiary, acquire the relevant business assets from Biomar, and take a lease at Biomar's León premises. Of the current Biomar staff, 13 will move over to 4D León as part of the transaction, with the expectation that a further five staff will be recruited over the next six months.
The consideration for the acquisition is 3 million euros which is payable on completion, and of which 2 million euros will be paid in cash, with the remaining 1 million euros being satisfied by the issue of 82,349 4D shares, at a price of £9.805 (being the average mid-market price of a 4D share for the five business days immediately preceding completion of the acquisition). In addition, a further 3 million euros will become payable in cash dependent upon GMP certification in respect of the production of live biotherapeutics at the León premises.
Alex Stevenson, 4D's Chief Scientific Officer, commented: "Over the past 12 months, we have witnessed first-hand the issues of relying on third party providers for the production of our product for clinical and development programmes. As our pace of development continues, with more of our programmes moving towards the clinic, 4D needs continued access to its own facilities to meet the challenges of our ambitious clinical development programmes, but also in looking forward to our initial production requirements.
Over the last 18 months we have worked closely with Biomar and have been impressed not only with their technical knowledge, but also their willingness to work as part of a team and advance the understanding of this new field. We felt that both the facility and team would be an ideal fit for 4D, providing continuous access to facilities under our control but also importantly the ability to expand."
Application has been made for the 82,349 new 4D shares issued on completion of the acquisition to be admitted to trading on AIM ("Admission"), and it is expected that Admission will take place on 14 April 2016.
Following Admission, the Company's issued share capital will consist of 64,858,150 ordinary shares. There are no ordinary shares held in treasury. Therefore, in accordance with the FCA's Disclosure and Transparency Rule 5.6.1, the Company confirms that, following Admission, the total number of voting rights in the Company will be 64,858,150.
Exchange rate used: £1 : €1.2385