Cangene Corporation
TSX : CNJ

November 21, 2006 08:02 ET

Cangene Corporation Announces $81 Million "Bought Deal" by Way of Treasury and Secondary Offering

TORONTO, ONTARIO--(CCNMatthews - Nov. 21, 2006) -

NOT FOR DISTRIBUTION TO UNITED STATES NEWSWIRE SERVICES OR FOR DISSEMINATION IN THE UNITED STATES

Cangene Corporation (the "Company") (TSX:CNJ), Apotex Holdings Inc. ("Apotex") and Sherman Foundation are pleased to announce that they have entered into an agreement with a syndicate of underwriters led by GMP Securities L.P. and including TD Securities Inc., Scotia Capital Inc and Sprott Securities Limited, which have agreed to purchase, on a bought deal basis 4,375,000 Common Shares from the Company and 5,625,000 Common Shares in the capital of the Company from Apotex and/or Sherman Foundation (the "Selling Shareholder") at a purchase price of $8.10 per Common Share, for aggregate gross proceeds of approximately $35,437,500 to the Company and aggregate gross proceeds to the Selling Shareholder of $45,562,500. The underwriters will also have an option, exercisable for a period of 30 days following the closing date, to purchase from the Selling Shareholder up to an additional 1,500,000 Common Shares on the same terms and conditions to cover over-allotments and for market stabilization purposes. The Company intends to use the net proceeds of the treasury offering for working capital, for general corporate purposes and to repay a portion of its outstanding indebtedness.

The common shares to be issued under this offering will be offered by way of a short form prospectus in all of the provinces in Canada and in the United States on a private placement basis pursuant to an exemption from the registration requirements of the United States Securities Act of 1933, as amended.

The offering is scheduled to close on or about December 14, 2006 and is subject to certain conditions including, but not limited to, the receipt of all necessary approvals including the approval of the Toronto Stock Exchange and the securities regulatory authorities.

Cangene is one of Canada's largest biotechnology companies. It was founded in 1984 and is headquartered in Winnipeg, Manitoba. Cangene carries out research and development in Mississauga, Ontario and Winnipeg. It uses patented manufacturing processes to produce plasma-derived and recombinant therapeutic proteins. In addition to having four approved products, Cangene has two products that have been submitted for regulatory review and a significant clinical trial program. Cangene also provides contract research and manufacturing services using its drug-manufacturing expertise and the resources of Chesapeake Biological Laboratories, Inc. (a wholly owned subsidiary). The Company has manufacturing facilities in Winnipeg, Manitoba and Baltimore, Maryland.

Forward-looking information

The reader should be aware that Cangene's businesses are subject to risks and uncertainties that cannot be predicted or quantified; consequently, actual results may differ materially from past results and those expressed or implied by any forward-looking statements. Factors that could cause or contribute to such risks or uncertainties include, but are not limited to: the regulatory environment including the difficulty of predicting regulatory outcomes; changes in the value of the Canadian dollar; the Company's reliance on a small number of customers including government organizations; the demand for new products and the impact of competitive products, service and pricing; cost of raw materials, especially the cost and antibody concentration in plasma; fluctuations in operating results; government policies or actions; progress and cost of clinical trials; reliance on key strategic relationships; costs and possible development delays resulting from use of legal, regulatory or legislative strategies by the Company's competitors; uncertainty related to intellectual property protection and potential cost associated with its defence; the Company's exposure to lawsuits, and uncertainties related to estimates and judgments used in preparation of financial statements in accordance with GAAP and related standards, and other matters beyond control of management.

Risks and uncertainties are discussed more extensively in the MD&A section of the Company's most recent annual report and annual information form, which are available on the Company's website or on SEDAR at www.sedar.com. Scientific information that relates to unapproved products or unapproved uses of products is preliminary and investigative. No conclusions can or should be drawn regarding the safety or efficacy of such products. Only regulatory authorities can determine whether products are safe and effective for the uses being investigated. Healthcare professionals are directed to refer to approved labelling for products and not rely on information presented in news releases.

The cautionary statements referred to above should be considered in connection with all written or oral statements, especially forward-looking statements, that are made by the Company or by persons acting on its behalf and in conjunction with its periodic filings with Securities Commissions, including those contained in the Company's news releases and most recently filed annual information form. Forward-looking statements can be identified by the use of words such as "expects", "plans", "will", "believes", "estimates", "intends", "may", "bodes" and other words of similar meaning. Should known or unknown risks or uncertainties materialize, or should management's assumptions prove inaccurate, actual results could vary materially from those anticipated. The Company undertakes no obligation to publicly make or update any forward-looking statements, except as required by applicable law.

NOT FOR DISTRIBUTION TO UNITED STATES NEWSWIRE SERVICES OR FOR DISSEMINATION IN THE UNITED STATES

Contact Information

  • Cangene Corporation
    Ms. Jean Compton
    Manager, Investor Relations
    (905) 405-2900
    Email: jcompton@cangene.com