BB's Stock Haven

[thewicked1]

MODG
May 15, 2007 - 9:56 AM EDT




Modigene Announces Closing of Merger and $9.6 Million Private Placement, Appointment of Dr. Phillip Frost and Dr. Jane Hsiao to its Board of Directors
VIENNA, Va., May 15 /PRNewswire-FirstCall/ -- Modigene Inc., a Nevada corporation (OTC Bulletin Board: MODG) today announced the closing of a $9.6 million private placement, simultaneously with a merger with Modigene Inc., a Delaware corporation ('Modigene Delaware'), a therapeutically driven biopharmaceutical company focused on the development and commercialization of long-acting versions of approved therapeutic proteins which address an existing combined market of more than $20 billion. Dr. Phillip Frost and Dr. Jane Hsiao have been appointed to Modigene's Board of Directors, following a $2 million investment in Modigene made by Dr. Phillip Frost, Dr. Jane Hsiao, Mr. Steve Rubin and Dr. Rao Uppaluri.

Modigene issued 6,418,808 shares at $1.50 per share for a total of $9,628,212 million, and 1,604,702 warrants in the private placement. With the additional $2 million investment from Dr. Frost, Dr. Hsiao, Mr. Rubin and Dr. Uppaluri, total gross proceeds were approximately $11.6 million. The warrants expire five years from issuance, and have an exercise price of $2.50. All of Modigene's directors, executives, and 5% shareholders have signed 18-month lock-up/no-sale agreements. Perceptive Life Sciences Master Fund, a well-known life sciences fund, participated in the private placement.

Modigene Delaware's management and Board of Directors have assumed operational control of the merged public entity, together with newly appointed members Dr. Phillip Frost and Dr. Jane Hsiao. Modigene's CEO, internationally- respected biotechnology entrepreneur Abraham Havron, Ph.D., was one of the lead developers of Merck Serono S.A.'s $1.3 billion multiple sclerosis (MS) drug. Rebif(R). Among his other clinical achievements, Dr. Havron developed BioTechnology General Ltd.'s (Rehovot, Israel) commercial hGH, BioTropin(R), and hepatitis B vaccine, Bio-Hep-B(TM); and a recombinant insulin that is currently licensed to Organon International, Inc. ('Organon').

Dr. Philip Frost is the former Chairman and CEO of IVAX Corp., having served from 1987 until IVAX's sale to Teva Pharmaceuticals in 2006 for $7.4 billion. Dr. Frost is the CEO and Chairman of Opko Health, Inc. (OTC Bulletin Board: EXEG), and the Vice Chairman of the Board of Teva Pharmaceuticals. Dr. Frost was named chairman of the board of Ladenburg Thalmann & Co., Inc., an American Stock Exchange-listed investment banking and securities brokerage firm, in July 2006 and has been a director of Ladenburg Thalmann since March 2005. He serves on the Board of Regents of the Smithsonian Institution, is a member of the Board of Trustees of the University of Miami, a Trustee of each of the Scripps Research Institutes, the Miami Jewish Home for the Aged, and the Mount Sinai Medical Center, and is Vice Chairman of the Board of Governors of the American Stock Exchange. Dr. Frost is also a director of Protalix BioTherapeutics, Inc., a biotech pharmaceutical company; Continucare Corporation, a provider of outpatient healthcare and home healthcare services, Northrop Grumman Corp., a global defense and aerospace company, Castle Brands, Inc., a developer and marketer of alcoholic beverages, and Cellular Technical Services, Inc., a provider of products and services for the telecommunications industry.

Dr. Jane Hsiao served as the Vice Chairman-Technical Affairs of IVAX from 1995 to January 2006. Dr. Hsiao served as IVAX's chief technical officer (CTO) since 1996, and as Chairman, CEO, and President of IVAX Animal Health, IVAX's veterinary products subsidiary, since 1998. From 1992 until 1995, Dr. Hsiao served as IVAX's Chief Regulatory Officer and assistant to the Chairman. Dr. Hsiao served as Chairman and President of DVM Pharmaceuticals from 1998 through 2006. Dr. Hsiao is a director of Protalix BioTherapeutics, Inc., a biotech pharmaceutical company; a director of Opko Health, Inc., a biotech pharmaceutical company; and Cellular Technical Services Company, Inc., a provider of products and services for the telecommunications industry.

Modigene's technology was discovered by researchers at Washington University in St. Louis, Missouri, and is based on a short amino acid sequence, the Carboxyl Terminal Peptide (CTP). CTP occurs naturally in the human body, and when attached to a therapeutic protein, extends the time that such protein can last effectively in the body. This has been demonstrated and validated by Organon - which, on March 12 2007, announced a deal to be acquired by Schering-Plough for $14.4 billion. Organon also licenses the CTP technology from Washington University, and has attached the CTP to a Follicle- Stimulating Hormone (FSH)-a hormone with approximately $1 billion in annual sales that is prescribed for females undergoing fertility treatments. Organon is currently in Phase III clinical trials with its FSH-CTP product, which could complete during 2007. Phase II trials demonstrated that a single injection of FSH-CTP was able to provide the same clinical effect as 7 consecutive daily injections of commercial FSH. These trials demonstrated that attaching the CTP did not affect the therapeutic activity of FSH or cause a negative immune system response in patients. Modigene has an exclusive license with Washington University for use of the CTP with all proteins except four endocrine proteins, which are licensed to Organon.

Modigene conducted preclinical animal model studies in CTP-modified human growth hormone ('hGH'), which is used to treat growth failure in children and adults, and has an existing estimated market size of $2.2 billion; and in CTP- modified erythropoietin ('EPO'), used to treat anemia, with an existing estimated market size of $11.7 billion. A single injection of hGH-CTP has shown the potential to replace 7 to 10 daily injections of commercial hGH, and EPO-CTP has demonstrated increased durability and biological effect over Amgen Inc.'s (AMGN-NASDAQ) Aranesp(R), a long-acting EPO with sales of $4.1 billion in 2006. In addition, Modigene conducted experiments demonstrating that interferon-beta-CTP has similar bioactivity as interferon-beta, for the treatment of multiple sclerosis, with an existing estimated market size of $3.8 billion.

'We are excited about the Modigene opportunity and believe in the management team, products, and underlying technology,' said Dr. Frost. 'We look forward to working together with the Board of Directors and management in building Modigene into a significant player in the therapeutic proteins market.'

'Modigene is developing long-acting versions of therapeutic proteins that have the potential to improve current treatment options in the therapeutic areas of growth hormone disorders, multiple sclerosis, anemia, and diabetes,' said Shai Novik, Modigene's President. 'We are completely focused on leveraging Modigene's versatile technology, capital-efficient business model, and multiple market opportunities to become a market leader in the area of long-acting therapeutic proteins. We believe Modigene will capitalize on its new status as a public company, and will be better positioned to increase shareholder value. We are delighted that Dr. Frost and Dr. Hsiao have made an investment and joined Modigene's Board of Directors. We believe Modigene will greatly benefit from the vast expertise and skills in biotechnology, pharmaceuticals and shareholder value creation, among many others, that Dr. Frost and Dr. Hsiao possess, and that will now be utilized as we continue to execute our product development and strategic plan for the therapeutic proteins market.'

Mr. Steve Rubin, the former Senior Vice President and General Counsel of IVAX, and Dr. Rao Uppaluri, the former Vice President of Strategic Planning of IVAX, have co-invested in Modigene together with Dr. Frost and Dr. Hsiao.

ABOUT MODIGENE

Modigene Inc. (OTC Bulletin Board: MODG) is a publicly-traded biopharmaceutical company utilizing patented technology to develop longer- acting, proprietary versions of already approved therapeutic proteins that currently generate billions in annual global sales. Modigene is currently developing long-acting versions of human growth hormone, erythropoietin, interferon beta, and GLP-1 - each representing a multi-billion dollar market. For more information on Modigene, please visit http://www.modigeneinc.com.

Safe Harbor Statement

This document contains forward-looking statements, including without limitation, statements concerning the completion of an equity financing. The forward-looking statements are also identified through use of the words 'potential,' 'anticipate,' 'planned' and other words of similar meaning. Actual results may differ significantly from the expectations contained in the forward-looking statements. The risks and uncertainties, including those related to the timing or successful completion of Modigene's product development and commercialization activities, are detailed in Modigene's filings with the Securities and Exchange Commission.

SOURCE Modigene Inc.



Source: PR Newswire (May 15, 2007 - 9:56 AM EDT)

News by QuoteMedia
www.quotemedia.com