Re: Renovis IPO
Disclosure: As shall become obvious, I am a very interested party here
This is the story, more or less ( details at www.nitrone.com ): Renovis took over the IP assets of Centaur Pharmaceuticals at firesale prices after Centaur collapsed.
Centaur was much further along than Renovis in drug development, but went bust because they could not raise a last round of financing. This was even as one of their potential block-buster nitrone drugs (Cerovive) entered phase-3 trials at AstraZeneca for stroke.
Not to mention that Centaur had other promising drugs in the pipeline, such as REN-1654, an oral drug for neuropathic pain now in Phase II clinical trials. For all of which, Centaur had about $125 million invested, the company being recently carried on the VC books at $200 million.
The VC people read the patent literature too. Arguably ( there seems to be no other explaination ), the VC guys pulled the plug because Centaur had serious patent problems involving my set of submarine patents, plus some other "prior art".
Apparently, nobody else wanted Centaur's intellectual property. So, rather than lose everything, they sold it cheap in a mostly stock deal for 16% of Renovis (about 12% after this IPO).
In fact, although their agreement was structured to make it appear that Renovis paid some cash, a coming $4.5 million milestone payment from AstraZeneca meant that in reality Centaur paid Renovis $3.75 million to close the deal.
Centaur also agreed to a hold-harmless clause reimbursing Renovis for any losses due to this patent problem. Since they have no other assets, this is presumablly limited to their Renovis stock holdings.
Now, having washed away the bloodstains, Renovis is doing an IPO based mostly on this otherwise very promising set of drugs. If Renovis can solve the problems that caused Centaur to fail, this is a good deal for Renovis stockholders. |
