Over the weekend Paladin Labs raised its purchase offer for Afexa Life Sciences for $0.81 a share. This morning, in response, Valeant brought its purchase offer up to $0.85, proving it isn’t ready to back down.
Afexa Life Sciences, creator of Cold-FX, started on the University of Alberta’s campus in 1992 and is currently headquartered in Edmonton, Alberta, Canada. Cold-FX, Afexa’s lead product, was created to “prevent and treat colds and the flu by strengthening the immune system”. Cold-FX was created by a team of 25 scientists through a dozen clinical trials and has been approved by regulators in the US and Canada.
Valeant originally offered to purchase Afexa for $0.71 a share in late August. Paladin offered a 14 per cent increase on the offer late Sunday pushing Valeant to counter offer for Afexa early Monday morning.
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"Paladin's Enhanced Offer is clearly superior for Afexa shareholders. The cash alternative is significantly higher and the share alternative gives Afexa shareholders the choice of continuing to have an interest in COLD-FX® and in the specialty pharmaceutical sector by accepting shares in Paladin, a diversified, profitable and rapidly growing company whose shares have significantly outperformed Afexa and the market generally over the past five years," said Mark Beaudet, interim President and Chief Executive Officer of Paladin. "The Valeant bid provides neither the value nor the choice of Paladin's Enhanced Offer."
"We have decided to offer a premium to Paladin Labs' most recent proposal as we are able to attribute more value than Paladin to the Afexa business given both our larger scale and resources in Canada, coupled with our extensive international consumer footprint," stated J. Michael Pearson, chairman and chief executive officer. "While we normally don't participate in an auction process, given that our existing offer has the full support of the Board and Management of Afexa, we felt it was appropriate to continue to respond quickly to Paladin's hostile overtures."