Reasons for the Merger
In evaluating the merger and the Merger Agreement, the Tekmira Board consulted with Tekmira’s management and legal, financial and other advisors and, in reaching its decision to approve the merger and enter into the Merger Agreement, the Tekmira Board considered a number of factors, including the following material factors which the Tekmira Board viewed as generally supporting its decision to approve the merger and the Merger Agreement:
Combined Pipeline to Better-Address HBV — Tekmira believes that to effectively treat and potentially cure HBV, multiple drugs targeting different aspects of the viral infection will be required in combination. The merger will bring together Tekmira and OnCore’s broad expertise in antiviral drug development, including Tekmira’s Phase 1 HBV RNAi therapeutic and OnCore’s multiple HBV programs, to build a more robust portfolio of compounds aimed at potentially eradicating HBV. The combined company’s most advanced products are expected to be (i) TKM-HBV, an RNAi therapeutic designed to eliminate HBV surface antigen (HBsAg) expression, a key component of host immune suppression, which began human clinical trials in the first quarter of 2015 and (ii) OCB-030, a second-generation cyclophilin inhibitor focused on the suppression of viral replication and stimulation and reactivation of the body’s immune response, which is anticipated to enter human clinical trials in the second half of 2015.
Combination of Near-Term Value Creation with Long-Term Potential — In addition to near-term clinical value drivers for the Tekmira shareholders, the merger will add seven additional new HBV development programs to Tekmira’s existing pipeline, allowing Tekmira to pursue a combination approach to HBV, which is expected to offer long-term upside potential for Tekmira shareholders by improving Tekmira’s probability of success in the HBV global market. The combined company anticipates advancing additional programs to clinical trials to evaluate combination regimens. The combined pipeline is expected to target the three pillars believed by management to be necessary to develop a curative regimen for HBV: (a) assets focused on suppressing HBV replication, (b) the reactivation and simulation of the host immune response directed at HBV and (c) the elimination of covalently closed circular DNA.
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