TORONTO, CANADA--(Marketwire - Sept. 29, 2011) -
NOT FOR DISTRIBUTION TO UNITED STATES NEWS SERVICES OR DISSEMINATION
Cynapsus Therapeutics Inc. ("Cynapsus" or the "Corporation") (TSX VENTURE:CTH) announced today that it has arranged financing (the "Financing") of secured Series E Debentures ("Secured Debentures") in the aggregate principal amount of $488,503. The Secured Debentures bear interest at a rate of 10% per annum and are secured by a security interest in the assets of the Corporation. The Secured Debentures are payable by Cynapsus on or before March 31, 2012. As part of the Financing, the Corporation will pay a 13% capital discount to the debenture holders resulting in net proceeds to the Corporation of $425,000 and issue 1,700,000 common shares to the debenture holders at a price of $0.05 per share. David Hill, a director of the Corporation, has subscribed in the principal amount of $28,735.
Cynapsus intends to complete further Series E debenture financings for up to a maximum additional amount of $1.5 million on or before November 15, 2011. Subsequent financings are subject to approval by the TSX Venture Exchange Inc. As previously announced, Summer Street Research Partners ("SSRP") has been retained by Cynapsus to provide financial and advisory services. SSRP will continue to act as the Corporation's placement agent.
The Corporation will use the proceeds of the debentures to fund ongoing research and development activities of the Corporation's APL 130277 product, repayment of the Series B debenture, working capital and general corporate purposes. The Corporation also will take the necessary actions to complete the Adagio Pharmaceuticals Ltd. acquisition in approximately 60-90 days (See August 17, 2011 Press Release).
The focus of the research and development activities will be the completion of a single dose human proof of concept ("SDHPOC") study within approximately 90-120 days. The goal is to obtain top line data in man that demonstrates fast-absorption and a Tmax comparable to the injectable form of the drug (Apokyn). Data acquired in the pilot study will define the parameters of a subsequent Phase 1 bioequivalence trial that compares the pharmacokinetics of sublingual APL-130277 to Apokyn as defined by section 505(b)(2) of the Federal Food, Drug and Cosmetic Act enforced by the United States Food and Drug Administration. This is the significant milestone and de-risking event for the project.
"We have demonstrated in an in vivo animal model that we can achieve a similar pharmacokinetic profile as the injectable Apokyn," stated Anthony Giovinazzo, President and Chief Executive Officer of Cynapsus. "In this human proof of concept study, we seek to demonstrate that the same profile is achievable in man. Since the sublingual tissue and drug absorption characteristics in the animal model are nearly identical to man, we have confidence in the outcome of this human study."
The Series E debentures will have an equal ranking security interest with the Series D debentures ($500,000) and will have a prior ranking security interest ahead of the Series A ($700,000) and Series C debentures ($300,000) in the assets of the Corporation pursuant to a priorities agreement between the holders of the said debentures. The Series B debenture ($100,000) will be repaid from use of proceeds. As part of the priority agreements, the maturity dates of all debentures (Series A, C, D) will be extended to March 31, 2012 (from December 30, 2011), and the capital discount and interest rate will be modified to match the Series E debentures (i.e. 13% and 10%, respectively).
The securities being issued are all subject to a four-month hold period in accordance with applicable Canadian securities laws. The securities have not been registered under the U.S. Securities Act of 1933, as amended, or any state securities laws and, until so registered, may not be offered or sold in the United States or any state or to, or for the account of, U.S. persons absent registration or an applicable exemption from registration requirements. This release does not constitute an offer for sale of securities in the United States.
About Cynapsus Therapeutics
Cynapsus is a specialty pharmaceutical company developing an improved dosing formulation of an approved drug used to treat the symptoms of Parkinson's disease. Parkinson's disease is a chronic and progressive neurodegenerative disease that impacts motor activity, and its prevalence is increasing with the aging of the population. It is estimated that between 25 percent and 50 percent of patients experience "off episodes" in which they have impaired movement or speaking capabilities. Current medications only control the disease's symptoms, and most drugs become less effective over time as the disease progresses.
Cynapsus' lead drug candidate, APL-130277, is an easy-to-administer, fast-acting and oral reformulation of an approved drug, apomorphine, used to rescue patients from off episodes. Cynapsus is focused on rapidly maximizing the value of APL-130277 by completing pivotal studies in advance of a New Drug Application expected to be submitted in 2013 or 2014. The Company anticipates out-licensing to an appropriate pharmaceutical partner before such an application is submitted.
More information about Cynapsus (TSX VENTURE:CTH) is available at www.cynapsus.ca and at the System for Electronic Document Analysis and Retrieval (SEDAR) at www.sedar.com.
Forward Looking Statements
This press release contains "forward-looking statements" within the meaning of applicable Canadian securities legislation. Generally, these forward-looking statements can be identified by the use of forward-looking terminology such as "plans", "expects" or "does not expect", "is expected", "budget", "scheduled", "estimates", "forecasts", "intends", "anticipates" or "does not anticipate", or "believes" or variations of such words and phrases or state that certain actions, events or results "may", "could", "would", "might" or "will be taken", "occur" or "be achieved". Forward-looking statements are subject to known and unknown risks, uncertainties and other factors that may cause the actual results, level of activity, performance or achievements of Cynapsus to be materially different from those expressed or implied by such forward-looking statements, including but not limited to those risks and uncertainties relating to Cynapsus' business disclosed under the heading "Risk Factors" in Cynapsus' current Annual Information Form and its other filings with the various Canadian securities regulators which are available online at www.sedar.com. Although Cynapsus has attempted to identify important factors that could cause actual results to differ materially from those contained in forward-looking statements, there may be other factors that cause results not to be as anticipated, estimated or intended. There can be no assurance that such statements will prove to be accurate, as actual results and future events could differ materially from those anticipated in such statements. Accordingly, readers should not place undue reliance on forward-looking statements. Cynapsus does not undertake to update any forward-looking statements, except in accordance with applicable securities laws.
The TSX Venture Exchange Inc. has not reviewed and does not accept responsibility for the adequacy or accuracy of this press release.