Pluristem Therapeutics Ltd. (Nasdaq:PSTI; DAX: PJT: PLTR) has signed a strategic partnership and exclusive licensing agreement with South Korea's Cha Bio&Diostech Co. Ltd. (KSX: 85660) for the use of Pluristem's PLacental eXpanded (PLX) cells for peripheral artery disease (PAD), and a $10 million share swap.
Pluristem will issue 2.5 million shares to Cha, when certain milestones are completed by September 2013, in exchange for 1,011,504 shares of Cha. The share swap is based on a share price of $4 for Pluristem, compared with yesterday's closing price on Nasdaq of $3, giving a market cap of $175 million. Pluristem's share price rose 10.7% in morning trading on the TASE, following the announcement, to NIS 11.48.
The licensing agreement specifically covers two indications: the treatment of critical limb ischemia (CLI), and intermediate claudication (IC) in South Korea. Cha will perform and fund multiple clinical trials in South Korea of Pluristem's PLX-PAD for treating these diseases under the supervision of the Korea Food & Drug Administration (KFDA). When the KFDA approves the treatment, the companies will establish a joint venture to commercialize PLX cell products in South Korea.
Pluristem cites a study by Clearstate, which states that one million South Koreans have PAD and the figure is rising.
While Cha will bear the costs of conducting the clinical trials for the agreed upon indications, Pluristem will continue to retain rights to its proprietary manufacturing technology and cell-related intellectual property. Pluristem will be able to use the data generated by Cha to pursue the development of PLX product candidates outside South Korea. The agreement may be extended to other indications as part of a long-term partnership.
Pluristem chairman and CEO Zami Aberman said, "We believe the alliance of Pluristem with a recognized leader of advanced healthcare systems in South Korea will provide multiple opportunities to strengthen our pipeline and develop PLX cells products for new indications. Cha Bio&Diostech's commitment to the PAD markets is an important milestone for us. We will be able to receive data from multiple CLI and IC trials that will enable us to optimize the clinical development of PLX-PAD. The co-owned joint venture will take advantage of Cha's unique and leading position in regenerative medicine in South Korea and Pluristem's proprietary 3D cells culturing capabilities. Pluristem is committed to a long and fruitful partnership with the CHA Health Systems Group."
"I believe the partnership between Pluristem and CHA Bio&Diostech carries far more significance with distinguished long-term business potential compared with other similar collaborations in the field of cell therapeutics by combining two companies' unique and unequaled technological prowess and outstanding leaderships in the industry," said Cha Bio&Diostech president and CEO Won S Yang. "Pluristem's pipeline PLX leveraging CHA Health Systems group's R&D, clinical development, regulatory and commercialization infrastructure focused on cell therapies in Korea will provide huge strategic advantage to entering Korea and global market territory in the future. Going forward, we expect PLX cells will be the first Pharmaceutical-like stem cell therapy product as well as the first allogenic product approved for the mass market to treat numerous patients suffering from serious disease such as the CLI and IC with limited cure."
Published by Globes [online], Israel business news - www.globes-online.com - on June 26, 2013
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