Full Press Release Details
Expands Investment in Discovery Labs to Advance Surfaxin LS and Aerosurf
Warrington, PA -October 13, 2010 -
Discovery Laboratories, Inc. (Nasdaq: DSCO), a biotechnology company
developing its novel synthetic surfactant and aerosol technologies for
respiratory diseases, today announces that it has entered into an agreement for
a new investment of $0.5 million from PharmaBio Development Inc. (PharmaBio),
the former strategic investing subsidiary of Quintiles Transnational Corp.
has agreed to purchase approximately 2.4 million shares of the Company's common
stock and warrants to purchase approximately 1.2 million shares of common stock
for gross proceeds of $0.5 million. Each common share, together with a
related warrant to purchase one half of a share of common stock, was sold at a
unit price of $0.21. The warrants have a five year term and are exercisable at
an exercise price of $0.273 per share of common stock. Should the
average price of the Company's common stock exceed $0.45 for any five out of
seven consecutive trading days for which stated minimum trading volumes are also
met, the Company is entitled to redeem the warrants upon 20 days written
our primary focus remains obtaining FDA approval for Surfaxin for
Respiratory Distress Syndrome in premature infants, this additional funding is
intended to primarily support near-term regulatory and related development
activities to progress Surfaxin LS and Aerosurf " said
John G. Cooper, President and Chief Financial Officer of Discovery
Labs and PharmaBio have a longstanding relationship and PharmaBio, before giving
effect to the offering, owns approximately 5.6 million shares of the Company's
common stock. In April 2010, Discovery restructured its $10.6 million
loan with PharmaBio, with the final payment of $2.0 million occurring on
September 30, 2010. Additionally, the two companies have agreed to continue
evaluating a potential long-term strategic collaboration focused on the
development of Surfaxin LS and/or Aerosurf, however, there can be no assurances
that any such arrangements will be entered into.
offering is being made solely to PharmaBio. The securities will be issued under
a previously filed registration statement that was declared effective by the
Securities and Exchange Commission on June 18, 2008. The transaction is
expected to close on or about October 14, 2010, subject to satisfaction of
customary closing conditions. This press release shall not constitute an offer
to sell or the solicitation of an offer to buy any securities of Discovery
Laboratories, Inc. nor shall there be any sale of the securities in any state or
jurisdiction in which such offer, solicitation or sale would be unlawful prior
to registration or qualification under the securities laws of any such state or
description of the financing with PharmaBio is subject in its entirety to the
definitive terms of the transaction documents, which are attached as exhibits to
the Form 8-K to be filed by the Company with the Securities and Exchange
Surfaxin, Surfaxin LS and Aerosurf
Labs lead programs, Surfaxin, Surfaxin LS and Aerosurf are being developed with
the potential to greatly improve the management of RDS in premature infants, and
collectively represent the opportunity, over time, to significantly expand the
current RDS worldwide annual market.
safety and efficacy of Surfaxin for neonatal RDS has been previously
demonstrated in a large, multinational Phase 3 clinical
program. Discovery Labs believes that to potentially gain FDA
marketing approval for Surfaxin for the prevention of RDS it must satisfy the
FDA as to the final validation of an important quality control release and
stability test for Surfaxin, the fetal rabbit biological activity test
(BAT). Discovery Labs is currently conducting a comprehensive
preclinical program that is intended to satisfy the FDA in this
respect. If approved, Surfaxin would be the first synthetic,
peptide-containing surfactant for commercial use in neonatal
Labs' development strategy for Surfaxin LS
(next-generation, lyophilized formulation of Surfaxin) is to build upon the
Surfaxin clinical experience to create a best-in-class surfactant therapy with
improved preparation and administration flexibility and the potential to further
improve clinical performance. Aerosurf
(drug/device combination for noninvasive administration of aerosolized KL4 surfactant
to address neonatal RDS) holds the promise to significantly expand the use of
surfactant therapy by providing neonatologists with a less-invasive means of
delivering KL4 surfactant
without the current requirement of invasive endotracheal intubation and
mechanical ventilation.
Surfaxin LS and Aerosurf are investigational drug or drug-device combination
products that have not been approved by the U.S. Food and Drug Administration or
any other world health regulatory authority.
Laboratories, Inc. is a biotechnology company developing KL4 surfactant
therapies for respiratory diseases. Surfactants are produced naturally in
the lungs and are essential for breathing. Discovery Labs' novel
proprietary KL4 surfactant
technology produces a synthetic, peptide-containing surfactant that is
structurally similar to pulmonary surfactant and is being developed in liquid,
aerosol or lyophilized formulations. In addition, Discovery Labs'
proprietary capillary aerosolization technology produces a dense aerosol, with a
defined particle size that is capable of potentially delivering aerosolized
surfactant to the deep lung without the complications currently associated with
liquid surfactant administration. Discovery Labs believes that its
proprietary technology platform makes it possible, for the first time, to
develop a significant pipeline of surfactant products to address a variety of
respiratory diseases for which there frequently are few or no approved
therapies. For more information, please visit our website at www.Discoverylabs.com.
To the extent that statements in this
press release are not strictly historical, all such statements are
forward-looking, and are made pursuant to the safe harbor provisions of the
Private Securities Litigation Reform Act of 1995. These
forward-looking statements are subject to certain risks and uncertainties that
could cause actual results to differ materially from the statements
made. Examples of such risks and uncertainties are: risks relating to
the rigorous regulatory requirements required for approval of any drug or
drug-device combination products that Discovery Labs may develop, including
that: (a) Discovery Labs and the U.S. Food and Drug Administration (FDA) or
other regulatory authorities will not be able to agree on the matters raised
during regulatory reviews, or Discovery Labs may be required to conduct
significant additional activities to potentially gain approval of its product
candidates, if ever, (b) the FDA or other regulatory authorities may not
accept or may withhold or delay consideration of any of Discovery Labs'