DENVER, May 11, 2005 (PRIMEZONE) -- OnSource Corporation ("OnSource") (OTCBB:OSCE) has completed its planned merger with Osmotics Pharma, Inc. ("OPI"), a specialty pharmaceutical company focused on dermatology, oncology and infectious disease. Pending approval from OnSource's shareholders, the company intends to change its name and operate under the name Ceragenix Pharmaceuticals.
The combined company will adopt OPI's business strategy and accordingly, has named the former OPI officers as OnSource's new executive management team. This team will be led by Steven Porter, Chief Executive Officer and supported by Jeffrey Sperber, Chief Financial Officer, Dr. Peter Elias, Chief Scientific Officer, and Carl Genberg, Senior Vice President of Research and Development. Additionally, Messrs. Porter and Sperber, along with Ms. Vicki Barone, a principal with Bathgate Capital Partners, were added to the OnSource Board of Directors, with Mr. Porter serving as Chairman.
OPI brings two base technology platforms: Barrier Repair Technology and Cationic Steroid Molecules. Applications of these technologies are currently being tested by some of the leading research institutions in the world, and OPI has filed a 510(k) application with the United States Food and Drug Administration seeking marketing clearance for Epiceram, its first commercial product candidate. Epiceram is a topical cream with proposed indications for use for the treatment of atopic dermatitis, radiation dermatitis and various other disorders caused by an impaired barrier function.
"The completion of this merger enables us to broaden our investor base, facilitate our ability to obtain capital, and supports the execution of our strategic plan," stated Mr. Porter."
Per the terms of the merger agreement, OnSource issued approximately 11.4 million shares of common stock to the holders of OPI's common stock representing approximately 92% of the issued and outstanding shares. Further, OnSource issued 1.0 million shares of 6%, Series A Preferred Stock with a stated value of $4.0 million (convertible into 1.0 million shares of OnSource common stock), approximately 1.1 million common stock purchase warrants and approximately 2.7 million stock options to the shareholders and employees of OPI.
"We are very pleased to complete this merger with OPI," said Frank Jennings, the CEO of OnSource. "We are excited by both the near- and long-term opportunities inherent in OPI's platform technology and believe that the entry into specialty pharmaceuticals provides a better opportunity to create continued value for our existing shareholders."
Porter continued, "It is our goal to commercialize a variety of therapeutic products that we believe will provide safe and effective approaches to unmet medical needs."
Two Platform Technologies
OPI holds exclusive intellectual property rights to two platform technologies for prescription products: (1) "Barrier Repair" technology, developed by Dr. Peter M. Elias, who currently serves as the Company's Chief Scientific Officer, and in-licensed from the Regents of the University of California; and (2) Cationic Steroid technology ("CSA"), developed by Professor Paul B. Savage of Brigham Young university and in-licensed from BYU.
Barrier Repair Technology (US Patent 5,643,899) is based on the discovery that the lack of a competent skin barrier function plays an important role in various skin diseases including atopic dermatitis (eczema), allergic contact dermatitis and ichthyosis and that the restoration of the skin's barrier by topically applying epidermal lipids is able to significantly improve the dry skin and itching that characterizes these conditions. Atopic dermatitis, a red, scaly and itchy skin disease, is the leading childhood skin disease. New therapies for atopic dermatitis are of special importance given the recent concerns raised over the potential adverse side effects associated with Protopic(r) and Elidel(r), two popular eczema creams that the FDA Pediatric Advisory Panel recently recommended that black box warnings be added to the labels regarding potential risk of the development of cancer from use of those immunosuppressive therapies. Epiceram(tm) is steroid-free and does not contain any immunosuppressant drugs
The Company's CSAs act as potent antibiotics against gram-negative and gram-positive bacteria, and can be used alone or with conventional antibiotics. Extensive in vitro testing has shown that CSAs are highly effective at very low concentrations against multi-drug resistant strains of Pseudomonas aeruginosa, Salmonella and other potentially lethal bacteria such as methicillin resistant staph aureus (MRSA) and vancomycin resistant staph aurues (VRSA). The technology is covered by two U.S. patents (6,350,738 and 6,486,148) and has been the subject of more than 10 peer-reviewed journal articles.
FORWARD-LOOKING STATEMENTS
This press release may contain forward-looking statements. The Private Securities Litigation Reform Act of 1995 provides a safe harbor for forward-looking statements. These forward-looking statements are subject to risks and uncertainties that may cause actual results to differ materially from those expressed or implied by such forward-looking statements, including, but not limited to, the following: the ability of the company to raise sufficient capital to finance its planned pharmaceutical activities, receiving the necessary marketing clearance approvals from the FDA, successful clinical trials of the company's planned products, the ability of the company to commercialize its planned products, market acceptance of the company's planned products, and the company's ability to successfully compete in the marketplace. Although management believes that the assumptions underlying the forward-looking statements are reasonable, any of the assumptions could prove inaccurate and, therefore, there can be no assurance that the forward-looking statements will prove to be accurate. In light of the significant uncertainties inherent in the forward-looking statements, the inclusion of such information should not be regarded as a representation by the company or any other person that the objectives and plans of the company will be achieved. For further information, please see the company's filings with the SEC, including its Forms 10-KSB, 10-QSB and 8-K. The company assumes no obligation to update its forward-looking statements to reflect actual results or changes in factors affecting such forward-looking statements.