Procept, Inc. Announces New Internet Business
Strategy
CAMBRIDGE, Mass. and CORAL SPRINGS, Fla.--(BW HealthWire)--Sept. 15, 1999--
Company Signs Letter of Intent to Merge With Heaven's Door
Corporation, Plans To Reserve Value of Biotechnology Assets
Procept, Inc. (Nasdaq SmallCap:PRCT - news) and Heaven's Door Corporation (privately held) today announced that they
have signed a non-binding letter of intent which contemplates the merger of Heaven's Door Corporation (``HDC') into
Procept, Inc. (``Procept'). Boards of Directors at each company have approved the continuance of negotiations toward the
signing of a definitive merger agreement. Separately, Procept also announced plans to structure the transaction so that the value
of the company's drug development compounds are reserved for the pre-merger Procept stockholders. The Company will
continue development of PRO 2000 Gel, O6-Benzylguanine, and its search for licensing partners for all drug compounds, and
at the same time will seek to sell the biotechnology assets to a larger biotechnology or pharmaceutical company.
HeavenlyDoor.com
HDC is creating a central worldwide source, through its website, www.HeavenlyDoor.com, to initially provide a
comprehensive range of products and services specifically related to the funeral services industry. HDC plans to later expand
this concept to other products and services for the elderly and the aging baby boomer population, including, but not limited to,
the long-term care and nursing home industry, and financial / estate planning.
``This represents a major strategic change and tremendous opportunity for Procept,' commented Mr. John F. Dee, President
and Chief Executive Officer of Procept. ``Through our planned merger with HDC, we are launching a new strategic effort on
the Internet, while retaining the value of our biotechnology assets for our shareholders. The phenomenal growth of the Internet
and on-line commerce combined with the unique growth opportunity that the funeral services industry offers gives us a new
opportunity to create value for our shareholders,' Mr. Dee continued. ``The funeral industry has $25 to $30 billion in revenues
in the U.S. alone. It is a highly fragmented industry made up of over 31,000 funeral homes, cemeteries, and monument dealers,
with very few having an Internet presence. We are also excited about expanding the website to other critical services for the
elderly.'
Mr. Howard Weiser, Founder and Director of HDC stated ``This merger with Procept should allow HDC to become the first
Nasdaq-traded Internet company focusing on the funeral industry and ultimately products and services for the elderly. First
mover advantage is critical in this business, and it would have taken us longer to attain such a presence alone. HDC can now
accelerate its business strategy, solidify its leading position, and focus on the growth opportunities which are very large.'
HDC's website provides consumers access to substantial information concerning the pre-arrangement and handling of funeral
related services, from the privacy of their home. In addition, the website will offer funeral homes and other service providers the
ability to have an Internet presence through a customized website designed specifically for the subscriber. HDC will help
arrange computer set-up in the funeral home. Furthermore, the website will be supported with national advertising to leverage
the strength of having many subscribers, enabling them to reach new markets. A description of the services currently provided
by HDC includes:
Funeral arrangement information: A database of over 27,000 funeral homes as well as a guide for the funeral
arrangement process, pre-need planning, etc.
Website design, development and support: Custom web presence for funeral homes, e-mail account set-up, on-line
funeral service scheduling, e-commerce set-up, and registration with major search engines.
On-line obituaries and testimonials: Taking the concept of the newspaper obituary and placing it online throughout the
world for friends and family members to share at a fraction of the cost of a one-time newspaper obituary.
On-line visits and testimonials: Allows family and friends to take a ``virtual visit' to a loved one's burial site without
leaving their home. Special messages will celebrate the life of loved ones or commemorate anniversaries and special
holidays.
E-commerce: Provides access to flowers, gifts, cards, books etc.
Terms of the Transaction
As currently contemplated, Procept will reserve the value of the biotechnology assets for the then-current Procept shareholders
at the closing of the merger. Then, Procept will issue new shares of Procept common stock to HDC shareholders in exchange
for all HDC equity, such that as contemplated, Procept shareholders will own approximately 60% of the new public Internet
company, and will retain 100% of the value of the biotechnology assets. Further details pertaining to the terms of the merger
will be released in the event that a definitive merger agreement is signed.
The closing would be contingent upon several conditions including (a) satisfactory due diligence by both parties; (b) the
negotiation and execution of the definitive agreement; (c) fairness opinions by independent investment bankers; and (d) the final
approval of the transaction by Procept's or both companies' shareholders. At this stage of the discussions, the outcome of these
and other contingencies is unknown.
The companies anticipate the transaction to close in the fourth quarter of 1999, subject to satisfaction of all necessary
conditions. The companies also expect that the available working capital after the consummation of the transaction, combined
with the existing and anticipated government support for the drug development programs, would fund both entities through
June, 2000. Procept will seek additional financing for the new public Internet company.
Drug Development Program
During the continuing search for potential partners and acquirers of the biotechnology assets, Procept intends to continue the
clinical development of its two lead compounds, both of which have substantial government support:
PRO 2000 Gel: PRO 2000 Gel is being developed as a vaginal, topical microbicide designed to provide protection
against human immunodeficiency virus (``HIV') infection and other sexually transmitted diseases (``STDs'). Two Phase I
clinical trials showed that PRO 2000 Gel is safe and well tolerated in healthy, sexually abstinent women. A larger safety
study in sexually active women and HIV-infected women is scheduled to begin shortly in the U.S. and South Africa, with
support from the National Institute of Allergy and Infectious Diseases, a unit of the National Institutes of Health.
O6-Benzylguanine (``BG'): BG is a chemosensitizer that is designed to overcome resistance to a significant class of
commonly used chemotherapeutic agents known as O6-alkylating agents. In preclinical animal studies, treatment with
BG increased the anti-tumor activity of BCNU in brain, colon, and prostate cancers. Following the imminent completion
of current Phase I clinical trials, a Phase II development program will be conducted in accordance with a Cooperative
Research and Development Agreement executed with the National Cancer Institute.
Mr. Dee further elaborated, ``We believe that these two drug compounds are well positioned to bring long-term benefits to the
medical community and our shareholders. We will continue to seek partnerships for these and our other programs including
BOPP, Procept's proprietary photodynamic therapy compound finishing Phase I clinical trials, and PTM, the Company's
diagnostic for periodontal disease, which has finished clinical trials in Japan.
Procept, Inc., located in Cambridge, MA, is a biopharmaceutical company currently engaged in the in-licensing, development,
and commercialization of novel drugs with a focus on anti-infectives and oncology. For additional information, visit their website
at www.procept.com. Heaven's Door Corporation, located in Coral Springs, FL and New York, NY, is a privately held
Internet company providing products and services currently related to the funeral industry. For additional information, visit their
website at www.heavenlydoor.com.
The above statements that are not strictly historical facts include forward-looking statements that involve a number of risks and
uncertainties. The actual results of the future events described in such forward-looking statements could differ materially as a
result of, among other things, the following: completion of the proposed acquisition, implementation of Internet strategies, ability
to develop commercially viable products, ability to establish strategic partnerships, ability to complete clinical trials on a
successful basis, general economic conditions and possible future litigation, as well as risks and uncertainties discussed in the
Company's public reports, filing and public statements. |
