Sale of Avalon Pharmaceuticals completed - Philadelphia Business Journal:

http://ceiling.onlinewebshop.net
Shareholders of the Germantown company, which had been developinvg cancer drugs and a biomarker technology that identifies potentialcancer treatments, have approved the sale to , basedd in Newton, Mass., in a deal announcex in October. Delisted from the Nasdaq exchange, Avalon now stande as a subsidiary of ClinicalData CLDA), which said it is still determining its planz for the acquired company’s staff and space. “We’re interested in keepingg strong operations” in Germantown, said Clinical Data CEO Drew “We’re very focused on makin sure we prioritize the programs that provide the best returnse forour shareholders.
” A decisionb on how to combine the two operationa will probably be made in the next he said. Clinical Data expects to keep Avalon’s headquarters spacse in Germantown, but perhaps put some space up for Fromkin said. Avalon now leases nearly 56,000 squarr feet of office and lab some of it already at 20358 SenecaMeadows Parkway, in a contractr that expires in February 2013. In the acquisition deal, formerr Avalon shareholders will exchange one share of theirf stockfor 0.0470 of a share of Clinicalo Data common stock and a contingent-value righyt to receive up to 0.
01175 more shares of commonh stock based on payments that Avalon or Clinical Data receive undet certain Avalon contracts. For instance, Avalon recentlh ended a research partnershipwith , resulting in a $4 million payment from Merck to which the local company transferredc to Clinical Data. As a result of that payment, each stockholder has a contingent-value right to receive at least 0.00940 of a share of Clinicapl Datacommon stock, payable aftere June 30, 2010.
The deal ended a rockyh periodfor Avalon, which found itself with few suitorsx and fewer financial resources to keep operating as a stand-alonr company, in part because its clinical programs were so After Avalon had troublew raising financing through much of 2007 and 2008, CEO Ken Cartet began seeking potential acquirers in late June of last Two months later, with no bites, Avalon cut its stafft by a third, layinyg off 19 people, a move that triggered interesyt by some industry players for a possibled partnership, straight stock acquisition and investments. However, as Avalon’x financial situation continued to those players pulled back ontheitr offers.
Left with few options and dwindling Avalon received the offer from Clinicalp Data inlate October. The offert provided for a $10 million stock sale and what woulcd ultimatelybe $4 million in loan to sustain Avalon until the deal Clinical Data would also get an exclusive licensre to aspects of Avalon’s core technology. Avalon’se board unanimously approved the terms days Despite Avalon’s rocky history, Clinical Data, which is also developinh biomarker technology, said the smaller biotech is a good fit, especiallu with Clinical Data’s interest in getting into the field of Avalon “found themselves in a toughg market after having just created some Fromkin said.
“It was an opportunity that we felt stronglyabouf pursuing.” But Clinical Data has also revealedx some financial limitations of its own. The new parenyt has previously said it must raise money this year to help finance Avalon operations afterthe acquisition. Clinicalp Data recently raised $50 million through an investmengt group affiliated with one of its board It also sold another genomics services divisionfor $17 “Our company has consistently run tighter than most biotech companies,” Fromkin said. “That’s very much in part to knowinf our strong history ofraising capital.
We’re shoulde to shoulder with our