Prometic Life Sciences (TSX:PLI) today spiked to near the top of the TSX most actively traded list after announcing a deal with China-based Shenzhen Hepalink Pharmaceutical.
Prometic says it will license its protein technology for a research and development project. The company says the deal is worth $11-million, and will include an upfront fee of $2-million. Management says it expects the completion of the project will lead to a long-term agreement for the exclusive manufacturing arrangement.
The company also revealed that Shenzen Hepalink will take a 10% stake in Prometic though a private placement that consists of a $10-million equity investment at $20.4 cents per share, which is a 63% premium over yesterday’s closing price.
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Pierre Laurin, President and CEO of ProMetic said the investment will help the company’s expansion plans.
“The $10-million strategic investment allows us to maximize the return to our shareholders by limiting the need to externally finance the launch of our Laval plasma facility and therefore ProMetic retaining a greater portion of its ownership,” mentioned Mr. Laurin. “Together, these agreements are pivotal to ProMetic’s expansion of its commercial activities into Asia and we are pleased to welcome Hepalink’s strategic contribution to this endeavour. Asia’s plasma and biopharmaceutical product markets represent an estimated 8 per cent of the world’s market whilst its population accounts for more than 50 per cent. These Asian markets are expected to grow at a 15-20-per-cent compounded annual growth rate over the coming years,” added Mr. Laurin.
Founded in 1992, Laval-based Prometic Life Sciences designs technology that is used to remove pathogens from blood, and extract and recover proteins from plasma.
At press time, shares of Prometic were up 8% to $.135 cents.