Biofrontera Inc., USA (“Biofrontera”), a wholly owned subsidiary of Biofrontera AG (NASDAQ ticker symbol: BFRA, ISIN: DE0006046113), today entered into an agreement to acquire all shares in Cutanea Life Sciences, Inc., USA (“Cutanea”) through its subsidiary Biofrontera Newderm LLC as the acquirer, with Maruho Co., Ltd., Japan (“Maruho”) as the seller. Maruho holds approximately 20% of Biofrontera AG.
Leverkusen, Germany, 25.03.2019 - Biofrontera AG Inc., USA (“Biofrontera”), a wholly owned subsidiary of Biofrontera AG (NASDAQ ticker symbol: BFRA, ISIN: DE0006046113), today entered into an agreement to acquire all shares in Cutanea Life Sciences, Inc., USA (“Cutanea”) through its subsidiary Biofrontera Newderm LLC as the acquirer, with Maruho Co., Ltd., Japan (“Maruho”) as the seller. Maruho holds approximately 20% of Biofrontera AG. Cutanea is a US-based pharmaceutical company specializing in dermatology. Cutanea markets AKTIPAK(R), a prescription gel for the treatment of acne, and in November 2018 launched XepiTM, a prescription cream for the treatment of impetigo, a frequent bacterial skin infection (Staphylococcus aureus or Streptococcus pyogenes). XepiTM is the only drug in its class approved by the Food and Drug Administration (FDA) with activity against antibiotic-resistant bacteria (MRSA).
The aim of the acquisition of Cutanea by Biofrontera is to effectively exploit the sales potential of AKTIPAK(R) and XepiTM in the USA. Any rights in Cutanea’s existing research and development activities originated from Maruho will remain with Maruho. Any other rights in Cutanea’s other research and development activities will be transferred to Maruho during a transition time. Maruho will provide up to 7.3 million US dollars (“Start-up Costs”) to start financing the commercialization of the two new drugs in Biofrontera’s portfolio. Maruho will also indemnify Biofrontera and Cutanea, respectively, from all existing liabilities and will bear any costs of the operational business of Cutanea in the first three months after the acquisition. Biofrontera will use its experience and expertise as well as its sales structure already successfully operating in the USA for the future successful marketing of AKTIPAK(R) and XepiTM. Biofrontera acquires Cutanea for an initial purchase price of 1.00 US dollar. The profits from the sale of AKTIPAK(R) and XepiTM, shown after deduction of all costs, will in the future be split between Maruho and Biofrontera, whereby Biofrontera guarantees Maruho as a further purchase price payment until 31 December 2023 a sum in the amount of the start-up costs. Thereafter, profits will be distributed equally.
Biofrontera AG, Hemmelrather Weg 201, 51377 Leverkusen
ISIN: DE0006046113
WKN: 604611
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Biofrontera provides corporate update; conference call details for March 26, 2019
Leverkusen, Germany, March 25, 2019 - Biofrontera AG (NASDAQ: BFRA; Frankfurt Stock Exchange: B8F) (the “Company”), an international biopharmaceutical company, announces a conference call to be held tomorrow to provide a detailed corporate update on its acquisition of Cutanea Life Sciences, Inc. (“Cutanea”). As announced earlier today, Biofrontera acquired 100% of the stock of Cutanea, a specialty pharmaceutical company focused on dermatology products from Maruho Co., Ltd. (“Maruho”). This transaction is expected to strengthen Biofrontera’s U.S. market presence and allow it to compete more effectively in the U.S. dermatology market by adding Cutanea’s products and expertise to its existing core business.
“This is a remarkable event and a bold step into the future for us,” says Hermann Lübbert, CEO of Biofrontera. “We are thrilled about combining Cutanea’s product portfolio and expertise with Biofrontera’s successful U.S. sales team. We believe that the transaction will complement and accelerate the growth of our business in the U.S. We recently announced the initiation of the next project stage in the branded generics development partnership with Maruho and our mutual plan to expand the label for Ameluz(R) to acne, which Maruho agreed to finance in connection with a license to sell Ameluz(R) in Asia and Oceania.”
These agreements demonstrate Maruho’s belief that Biofrontera is a partner with an outstanding track record in clinical development and drug approval and the development of a U.S. sales infrastructure.
“We have a longstanding, trusting relationship with Biofrontera in Europe, including as a significant shareholder,” comments Koichi Takagi, President and CEO of Maruho. “Biofrontera Inc. already has a successfully established U.S. salesforce, and we believe they will further increase their capabilities by incorporating Cutanea’s sales representatives and marketing expertise into their team and capitalizing on additional experience and know-how. We are confident that this expanded salesforce will continue and accelerate the momentum and sales growth of XepiTM and AKTIPAK(R).”
Transaction highlights:
- Maruho will provide an amount of up to USD $7.3 million as start-up funding for the business activities of Cutanea as operated by Biofrontera (“Start-up Costs”).
- Biofrontera acquires Cutanea for an initial purchase price of 1.00 US-Dollar. A purchase price equaling the Start-up Costs effectively paid shall be payable to Maruho by 2023. Thereafter, profits from the sale of Cutanea products will be equally shared between Maruho and Biofrontera until 2030.
- Any rights in Cutanea’s existing research and development activities originated from Maruho will remain with Maruho. Any other rights in Cutanea’s other research and development activities will be transferred to Maruho during a transition time.
- Maruho has further agreed to cover any ongoing expenses, which may be incurred in the first three months following the closing of the transaction. Maruho will furthermore indemnify Biofrontera and Cutanea from any liabilities relating to or arising from the period prior to the closing.
- The addition of two FDA-approved products already launched on the U.S. market and the opportunity to integrate further expertise from Cutanea is expected to strengthen Biofrontera’s market position and serve as an additional platform for organic growth. The new products are complementary to Biofrontera’s core business and focused on the pursuit of similar customers within the dermatology space.
- Biofrontera believes this acquisition represents a significant step towards becoming a broader specialty pharmaceutical company in dermatology in the U.S.
As already announced last week (see press release from March 19, 2019), Biofrontera also signed a contract with Maruho to commence the second phase of a joint drug development collaboration. Biofrontera will investigate preclinical aspects of the nanoemulsion formulation of one of the four active ingredients tested in the initial project phase.
In addition, Biofrontera and Maruho are in negotiations about a possible indication expansion of Ameluz(R) for acne. The parties are also discussing a license for Maruho to commercialize Ameluz(R) in Asia and Oceania. Maruho would initially assume all development costs for the acne indication expansion, part of which may be returned if license negotiations are not successful. Biofrontera would be responsible for carrying out the clinical studies required for approval in the U.S.
Maruho holds approximately 20% of the shares in Biofrontera.
Conference call details:
Conference calls for shareholders and interested investors will be held on Tuesday, March 26, 2019 at the following times:
In German, at 12:00 am CET (7:00 am ET)
Dial-in number Germany: +49 69 201744220
Conference code: 24761264#
In English, at 2:00 pm CET (9:00 am ET)
Dial-in number USA: +1 8774230830
Dial-in number UK: +44 2030092470
Conference code: 10779355#
Please dial in 5 minutes ahead of time to ensure a timely start of the conference call.
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