CHARLOTTE, N.C., Feb. 16, 2005 (PRIMEZONE) -- Chelsea Therapeutics, Inc., a biopharmaceutical development company that acquires and develops innovative products for the treatment of a variety of human diseases, announced today that it has completed its reverse merger with Ivory Capital Corporation (OTCBB:IVRC). Chelsea recently raised approximately $14.5 million in a private placement for which Paramount BioCapital, Inc. acted as placement agent. As a result, the merger with Ivory establishes a well-capitalized, publicly traded, biopharmaceutical company.
The merged company, headquartered in Charlotte, North Carolina, will operate under the name Chelsea Therapeutics, Inc., adopting both Chelsea's business strategy and current management team led by President and Chief Executive Officer Dr. Simon Pedder. The combined company will continue to be quoted on the OTC Bulletin Board under the symbol IVRC.
"The completion of this merger enables Chelsea to broaden its investor base, create a liquid market for our stock, and support the accelerated execution of our strategic plans," commented Dr. Pedder. "As a result of our recent strategic initiatives -- this merger and recent Series A financing -- we have the management expertise, balance sheet strength and capital structure to drive the aggressive clinical development of our promising portfolio of product candidates and launch Phase I clinical trials for our lead product candidate, CH-1504, for the treatment of multiple indications including rheumatoid arthritis."
The transaction was structured such that a subsidiary of Ivory merged with Chelsea in a stock-for-stock transaction in which Ivory issued shares of Ivory common stock to holders of Chelsea shares, based on an exchange ratio that resulted in Chelsea shareholders owning approximately 96.75% and existing Ivory shareholders owning approximately 3.25% on a fully diluted basis. All outstanding options to purchase Chelsea common stock have been replaced with options to purchase Ivory common stock.
Following this transaction, the company intends to re-incorporate in Delaware under the name Chelsea Therapeutics, and will change its fiscal year-end to December 31. As part of the reincorporation in Delaware, the company currently intends to reduce the number of shares issued and outstanding approximately ten fold. If that is done, the total number of issued and outstanding shares of common stock will be reduced to approximately 10,720,278 shares. The company also intends to request a new trading symbol, to be announced as soon as available.
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, or RA, psoriasis, cancer and other immunological disorders. An independent six-month pilot clinical study compared CH-1504 to methotrexate, or MTX, the current standard of care, in 20 RA patients. Although the pilot study will not be used as a part of the U.S. 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 biopharmaceutical development 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 our strategy to become publicly traded, including potential volatility and lack of liquidity of the market for our stock, as well as 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.