Financially strapped PharmaKinetics Laboratories Inc., which planned to sell its key assets to a New Jersey company, has announced the deal has fallen through.
The Baltimore-based drug-development company said yesterday that negotiations have been suspended with Applied Bioscience International of East Millstone, N.J., and that it did not anticipate the negotiations would resume.
PharmaKinetics said on Oct. 4 that it would sell its U.S. operations to Applied Bioscience for $4.8 million in cash and contingent payments of $2 million over a period of up to five years.
Yesterday, PharmaKinetics announced that it had received notices of default from Maryland National Bank concerning the company's $2.5 million note and financing agreement and its revolving credit note.
PharmaKinetics, which employs about 125 people, said it is in discussions with the bank regarding the default.
When the deal with Applied Bioscience was announced, Steven A. Woodman, former president and chief executive officer of PharmaKinetics, said it would become a wholly-owned subsidiary of the New Jersey company.
Woodman this week assumed a business-development role and was replaced by V. Brewster Jones.
Jones, who was previously president of the U.S. operations of PharmaKinetics, was not immediately available for comment. Kenneth H. Harper, president and chief executive officer of Applied Bioscience, also was not available.
PharmaKinetics has been hurt along with the rest of the generic drug industry by a government probe into falsified information submitted by several manufacturers, even though the FDA said PharmaKinetics is not one of the target companies.
The price of the company's stock has fallen from $5.50 a year ago to less than $1.
PharmaKinetics had a loss of $3.8 million, or 40 cents a share, in its fiscal year ending June 30, 1990.