Starpharma Holdings will acquire Dendritic Nanotechnologies (DNT) for $6.97 million, payable through the issue of Starpharma shares. Starpharma will gain accesss to DNT’s IP portfolio, the largest, according to the company, in the field of dendrimers. It also anticipates a diversified product pipeline with near-term cash-flow opportunities, a more balanced risk profile, potential business synergies, and an expanded U.S. presence.
Starpharma currently owns 33% of DNT and The Dow Chemical Company owns 30%. Post transaction, DNT will become a wholly owned operating subsidiary of Starpharma Holdings, and Dow will hold approximately 8.6% of Starpharma. The transaction is subject to DNT shareholder approval, which Starpharma expects to obtain in the next two weeks.
Starpharma predicts that it will gain diversified revenue opportunities through the addition of DNT’s drug delivery and industrial specialty chemical applications to its product portfolio. The company will gain ownership of DNT’s Priostar™ dendrimer technology, scalable, precision nanostructures. DNT recently received an SBIR grant to develop this technology for use as a diagnostic, as well as a therapeutic delivery system for early-stage epithelial ovarian cancer.
DNT says that the Priostar technology allows for nanostructures to be manufactured at industrial volumes at a low cost. Priostar dendrimers together with Starpharma’s existing polylysine dendrimers will allow Starpharma to commercially exploit opportunities in a broad range of industries, from high margin pharmaceutical goods, to larger volume industrial applications.
“DNT has exciting new intellectual property in its Priostar dendrimers, with existing royalty streams in place from leading life-science companies,” says Starpharma CEO, Jackie Fairley. “We believe that the combined entity is ideally placed to capitalize on the significant commercial opportunities for the technology. This will give Starpharma the opportunity to commercialize dendrimer technology not only in the pharmaceutical sector but also into other nearer-term life science and industrial applications.”
The total number of Starpharma shares to be issued is 20,096,899, representing about 13.6% of the issued capital of the company. These shares will rank equally in all respects with existing shares on issue. Shares issued as part of this transaction will be subject to varying escrow arrangements of up to three years. Starpharma has also agreed to a royalty arrangement with Dow for a proportion of existing DNT royalty streams for up to five years, providing Dow maintains its shareholding in Starpharma.