CHARLOTTE, N.C., Jan. 21, 2005 (PRIMEZONE) -- Chelsea Therapeutics, Inc., ("Chelsea") of CHARLOTTE, NC, and Ivory Capital Corporation ("Ivory") (OTCBB:IVRC), have signed a definitive agreement to combine in a reverse merger transaction that will establish the merged company as a publicly listed, well capitalized biopharmaceutical company. Founded in 2002, Chelsea is currently privately held.
Following completion of the merger, expected to close in the first quarter of 2005, the merged company will be known as Chelsea Therapeutics, Inc. and will be headquartered in Charlotte, NC. The company will adopt Chelsea's business strategy, continue to be quoted on the OTC Bulletin Board and continue to be headed by Chelsea's current management team led by CEO Dr. Simon Pedder. Dr. Pedder joined Chelsea from Hoffmann-La Roche Inc. where he oversaw several successful New Drug Applications (NDAs); led the development of the therapeutics Pegasys and Copegus, which have combined annual worldwide sales of over $1 billion; and rose to the position of VP of Pharmaceutical Business, Oncology. Dr. Pedder also served as an officer for the pharmaceutical giant.
The Chelsea/Ivory agreement, which was unanimously approved by both companies' Boards of Directors, is subject to Chelsea shareholder approval and other customary closing conditions. Pursuant to the terms of the agreement, a subsidiary of Ivory will be merged with Chelsea in a stock-for-stock transaction in which Ivory will issue shares of Ivory common stock to holders of Chelsea shares, based on an exchange ratio that will result, upon completion of the proposed transaction, in Chelsea shareholders owning approximately 96.75% on a fully diluted basis. Current Ivory shareholders will own approximately 3.25%, of the merged company's fully diluted common stock. All outstanding options to purchase Chelsea common stock will be replaced with options to purchase Ivory common stock. Ivory expects to file shortly with the SEC a registration statement for certain of the shares to be issued to Chelsea's shareholders.
"This transaction will further strengthen Chelsea's position as a competitive player in the biotech market. We approach the expected launch of Phase I clinical trials for our lead product candidate, CH-1504, with a significant cash position and will now have public-company currency," commented Dr. Pedder. "Moreover, the company formed by this merger will have the strategic, operational and financial resources for significant future growth. We will have a proven and successful senior management team, a promising portfolio of product candidates and the financial flexibility to drive the implementation of our core strategic, financial and operational goals. In short, we believe that the new Chelsea will be very well positioned to capture a unique market and value-creation opportunity."
On January 11, 2005, Chelsea announced the successful completion of its Series A Preferred Stock financing, resulting in gross proceeds to the company of $14.5 million. Paramount BioCapital, Inc. acted as placement agent. Dr. Pedder said, "We welcome the recent financial commitment to Chelsea of our Series A investors. Their support is a validation of our current therapeutic pipeline, business progress, and long-term prospects, enabling us to accelerate the clinical development of CH-1504 for the treatment of multiple indications including rheumatoid arthritis."
About CH-1504
In March 2004, Chelsea acquired the worldwide rights to a set of antifolate compounds, including CH-1504. While Chelsea is researching several compounds within this library, its lead product candidate, CH-1504, continues successful progress in its development as a treatment for rheumatoid arthritis (RA), psoriasis, cancer and other immunological disorders. An independent six-month pilot clinical study compared CH-1504 to methotrexate (MTX), the current standard of care, in 20 RA patients. Although this study was not conducted in compliance with U.S. and international standards necessary for its use in the regulatory approval process, the results of this study indicate that CH-1504 has lower toxicity and improved tolerability, as well as increased effectiveness versus MTX, even among patients who had previously failed to demonstrate improvement with MTX treatment. MTX currently accounts for almost half of the prescriptions written for the RA market.
About Chelsea Therapeutics, Inc.
Chelsea Therapeutics is a privately held, development-stage biopharmaceutical company that acquires and develops innovative products for the treatment of a variety of human diseases. Chelsea develops technologies that address important unmet medical needs or offer improved, cost-effective alternatives to current methods of treatment. Early clinical data suggests that Chelsea's lead product candidate, CH-1504, may support a safe and effective treatment for rheumatoid arthritis and may have further applications for psoriasis, certain cancers and other immunological disorders.
This press release contains forward-looking statements regarding future events. These statements are just predictions and are subject to risks and uncertainties that could cause the actual events or results to differ materially. These risks and uncertainties include risks and costs associated with drug development, regulatory approvals, intellectual property risks, our reliance on our lead drug candidate CH-1504, competition, market acceptance for our products if any are approved for marketing, reliance on key personnel including specifically Dr. Pedder, management of rapid growth, and the need to acquire additional products.