Resverlogix CEO says company in discussions to be acquired

Resverlogix Corp., a Canadian company developing a drug to fight thickening arteries, is in discussions with several global pharmaceutical companies for a potential sale, according to its chief executive officer.
“We are in discussions with multiple companies, not just one,” Donald McCaffrey, CEO of Calgary-based Resverlogix, said in a phone interview. He declined to offer any information on the negotiations, including timeframe or price.
Resverlogix’s discussions come amid a flurry of consolidation in the pharmaceutical and biotechnology industry this year, with almost USD100 billion in deals in the first quarter, according to data compiled by Bloomberg. Teva Pharmaceutical Industries Ltd. said Monday it was taking its $40.1 billion takeover offer for Mylan NV directly to shareholders after the company rejected it. Concordia Healthcare Corp., the best-performing stock on Canada’s Standard & Poor’s/TSX Composite Index, is seeking acquisitions in Europe.
“We see ourselves as a potential acquisition target,” McCaffrey said. “We are tightly controlled, so we wouldn’t let it go at anywhere near the rates we’re at right now.”
McCaffrey holds 5.3 percent of Resverlogix, while Pakistan-based Eastern Capital Ltd. owns 17.5 percent, according to the latest filings compiled by Bloomberg.
Resverlogix’s shares rose 6.7 percent to C$2.87 on Monday in Toronto and have risen almost sixfold since January.
Resverlogix’s drug, RVX-208, works by boosting production of a particle required in a process called reverse cholesterol transport, in which plaque in the arteries is removed from the body using the liver. The company said it can potentially be used to help in a variety of treatments, from heart disease to Alzheimer’s and kidney disease.
The drug is on track for the retail market in 2020, McCaffrey said.
Under a deal announced Monday, Shenzhen Hepalink Pharmaceutical Co. will acquire a 13 percent stake of Resverlogix for C$35 million ($29 million) and Eastern Capital will boost its stake to as much as 25 percent for C$15 million.
Resverlogix would also get future licensing royalties and sales milestone payments potentially worth more than $400 million for sale of the drug in China, Hong Kong, Taiwan and Macau from Hepalink. Eric Lam, Bloomberg