The commercialization agreement beween BiolineRX Ltd. (TASE:BLRX) and Cypress Bioscience Inc. (Nasdaq: CYPB) is moving forward on schedule. Cypress, which signed the commercialization agreement, which could be worth up to $365 million for BiolineRX, a few months ago, is moving forward on regulatory procedures on BiolineRX' treatment for schizophrenia, BL-1020.
Cypress reports progress on regulatory procedures, and the companies are waiting for national regulators to conduct clinical trials.
BiolineRX, a drug development company run by CEO Dr. Kinneret Savitzky, plans to hold an offering on Nasdaq. The company is a kind of incubator for drugs discovered at academic institutions, by leading preclinical and clinical trials of the drugs and commercializing them. The company has over ten drugs in its pipeline. Besides the commercialization agreement with Cypress, it has a similar agreement for its heart attack drug, BL-1040, with Ikaria Holdings Inc.
The progress on the regulatory procedures is important, given the cloud hanging over Cypress. An internal struggle began at the company in July, a month after the commercialization agreement with BiolineRX was signed. Ramius Value and Opportunity Advisors LLC, which owns 10% of Cypress and which opposes the BiolineRX agreement, submitted an offer to purchase to other shareholders. In a letter to Cypress' board, Ramius managing director Jeffrey Smith said that the management team has made "increasingly risky investments with shareholder money."
Ramius made a similar claim in a letter yesterday to Zoran Corp. (Nasdaq: ZRAN).
BiolineRX's share price rose 0.3% by mid-afternoon today to NIS 3.09, giving a market cap of NIS 384 million.
Published by Globes [online], Israel business news - www.globes-online.com - on December 7, 2010
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