EntreMed is buying Calif. drugmaker

December 23, 2005|By TRICIA BISHOP | TRICIA BISHOP,SUN REPORTER

EntreMed Inc., a Rockville pharmaceutical company developing treatments for cancers and inflammatory diseases, announced yesterday that it plans to acquire privately held drug developer Miikana Therapeutics Inc. of California in a stock deal worth about $21.2 million.

Under the merger agreement, EntreMed will obtain Miikana's outstanding shares in exchange for 9.96 million shares of EntreMed stock, which closed down 5 cents at $2.07. Trading in EntreMed shares was 10 times the normal volume on the Nasdaq stock market.

EntreMed also will pay the Freemont, Calif., biotech as much as $18 million extra if certain clinical and regulatory milestones are met.

Acquiring Miikana - which means "path" in the Ojibwa American Indian language - will add to EntreMed's drug development portfolio, which currently includes anti-cancer drugs in clinical testing. Miikana brings three more to the table, all designed to treat cancers.

"We spent considerable time this year looking at opportunities to broaden our pipeline with product candidates that fit our expertise," EntreMed chief executive James S. Burns said in a prepared statement. "The acquisition of Miikana is a logical step in EntreMed's growth."

The acquisition, which does not require regulatory approval, should be complete by next month, EntreMed said.

EntreMed reported a net loss for the third quarter, which ended Sept. 30, of $4.4 million, an increase of 42 percent over the loss for the comparable quarter last year. The company attributed the increased loss to expenses associated with clinical trials.

tricia.bishop@baltsun.com

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