Filed by Endorex Corporation pursuant to Rule 425 of the Securities Act of 1933,
as amended, and deemed to be filed pursuant to Rule 14a-12 of the Securities
Exchange act of 1934, as amended.
Subject: Corporate Technology Development, Inc.
Commission File No. 1-14778
ON AUGUST 1, 2001, ENDOREX CORPORATION, A DELAWARE CORPORATION AND CORPORATE
TECHNOLOGY DEVELOPMENT, INC., A DELAWARE CORPORATION, JOINTLY ISSUED THE
FOLLOWING PRESS RELEASE:
C O R P O R A T I O N
28101 BALLARD ROAD, SUITE F
LAKE FOREST, IL 60045
www.endorex.com
Endorex Contact: Corporate Technology
Michael Rosen Development, Inc. Contacts:
President & CEO Steve H. Kanzer
847-573-8990 President
305-777-2258
Investor/Media Contact: Nicholas Stergiopoulos
The Investor Relations Group Director of Business Development
Dian Griesel, Ph.D./Lisa Lindberg 305-777-2258
212-825-3210
TheProTeam@aol.com
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ENDOREX TO ACQUIRE PRIVATELY HELD PHARMACEUTICAL COMPANY
Acquisition Will Significantly Expand Clinical Stage Product
Portfolio with "Fast-Track" Phase III Program
and
Strengthen Management Team with the Addition of New
Chairman and Chief Executive Officer, Colin Bier
CHICAGO, Illinois and MIAMI, Florida, August 1, 2001 (Business Newswire). On
July 31, 2001, Endorex Corporation (Amex: DOR - news) and Corporate Technology
Development, Inc. ("CTD"), a privately held specialty pharmaceutical company
based in Miami, Florida, have entered into a
definitive agreement for Endorex to acquire all of the outstanding capital stock
of CTD in a stock-for-stock merger.
The boards of directors of Endorex and CTD have each approved the merger and the
merger agreement and have agreed to recommend that their respective stockholders
vote in favor of the Merger. Certain stockholders of CTD holding a majority of
CTD's outstanding preferred stock and a majority of CTD's outstanding common
stock have entered into a voting agreement pursuant to which they have agreed to
vote for the merger.
This acquisition will broaden Endorex's product pipeline by the addition of two
drug candidates currently in clinical development as well as other products in
preclinical development. Additionally, as of June 30, 2001, CTD had no debt and
approximately $5 million in cash, which CTD believes will be sufficient to fund
development of these two products in the near term and to take orBec(TM), its
lead drug candidate in phase III clinical trials, through the FDA approval
process. Furthermore, CTD's Chairman, Colin Bier, Ph.D., will join the Endorex
management team as Chairman and CEO, and two other CTD board members, along with
Mr. Bier, will join the Endorex board.
Michael Rosen, Endorex's President and Chief Executive Officer, stated, "The
addition of CTD's clinical pipeline of drug candidates, one of which is in a
phase III clinical trial, increases the depth of the Endorex product pipeline.
This portfolio of novel and proprietary formulations of off-patent small
molecule drugs complements our oral delivery programs of large molecule
(peptide- and protein-based) drugs such as human growth hormone, insulin and
vaccines. Furthermore, with this acquisition, Endorex strengthens its balance
sheet with additional cash. CTD represented a unique opportunity to acquire late
clinical stage oral and mucosally-delivered product candidates, cash resources
that we believe is sufficient to develop those product candidates to market, an
intellectual property portfolio and an opportunity to further diversify our
shareholder base with additional investor groups."
Colin Bier, Ph.D., CTD's Chairman, stated: "We believe that the combined product
portfolio of the two companies, together with the strength of our combined
balance sheet and organizational network will create an exciting company with
products to enhance patient quality of life. I look forward to joining the
Endorex team."
Drug Pipeline
orBec(TM), which is currently in a multi-center phase III clinical trial, is
under development for the treatment of intestinal graft-versus-host disease
("GVHD"), a life-threatening complication affecting the skin, liver, and the
gastrointestinal tract ("GI") following bone marrow transplantation. According
to the International Bone Marrow Transplant Registry & Autologous Blood and
Marrow Transplant Registry, there were 17,000 allogeneic bone marrow transplants
(transplants of blood or bone marrow cells from another person) worldwide in
1998. It is estimated that intestinal GVHD affects approximately 15-30 percent
or about 2500 to 5100 of these patients per year worldwide, and results in a
high mortality rate. Allogeneic transplants remain a viable treatment strategy
for a variety of cancers. CTD is also planning other phase II clinical trials
for the treatment of other GI related disorders, which represent larger market
segments.
The FDA has granted orBec(TM) "fast track" status for the treatment of
intestinal GVHD, allowing for an expedited review process. orBec(TM) has also
been designated as an "orphan drug" by the FDA for the prevention of Intestinal
GVHD.
orBec(TM) is an oral dual-release formulation of beclomethasone dipropionate, or
"BDP," a potent site-active corticosteroid drug. BDP has already been approved
by the FDA and is sold by GlaxoSmithKline, as Beconase, in an inhaled and nasal
formulation for the treatment of asthma, allergic rhinitis, and nasal polyposis.
orBec(TM) allows for larger doses of BDP to be delivered to the afflicted GI
area without systemic side effects associated with other steroids used to treat
intestinal GVHD.
CTD's second clinical-stage compound is Oraprine, a liquid formulation of a
commonly prescribed immunosuppressant, azathioprine, the active pharmaceutical
ingredient in Imuran. Imuran is currently marketed in tablet form for the
treatment of transplant rejection by Faro Pharmaceuticals, Inc. in North America
and GlaxoSmithKline worldwide. Oraprine has recently completed a phase I
bioequivalency trial which demonstrated that Oraprine(TM) is equivalent to
Imuran. In addition, a pilot phase I/II has been completed for the treatment of
chronic oral autoimmune diseases, such as oral GVHD. Oraprine(TM) has been
designated an "orphan drug" for the treatment of oral GVHD.
Management Team
Upon closing, CTD's Chairman, Colin Bier, Ph.D., will join Endorex as Chairman
of the Board and Chief Executive Officer. The current Chairman, Kenneth Tempero,
M.D., Ph.D., will continue to serve as a director of Endorex. Michael S. Rosen,
the current Endorex President and Chief Executive Officer, will remain as
President and assume the newly created position of Chief Operating Officer of
Endorex. Steve H. Kanzer, currently CTD's President and Chief Executive Officer
and an Endorex director, will remain on the Endorex board. Three members of the
CTD board, including Dr. Bier, will become members of the Endorex board.
Colin Bier, Ph.D., has served as Chairman of the Board of Directors of CTD since
2000 and as a director since 1998. Since 1989, Dr. Bier has been Managing
Director of ABA BioResearch, an independent bioregulatory consulting firm. Dr.
Bier also serves as chief executive of the Centre for Translational Research in
Cancer R&D Inc. of the Sir Mortimer B. Davis - Jewish General Hospital in
Montreal, Canada. Dr. Bier is a director of two public biopharmaceutical
companies. He is also a Senior Advisor to TVM TechnoVenture Management. Dr. Bier
received his Ph.D. in Experimental Pathology from Colorado State University, and
pursued a post-doctoral fellowship in pathology at McGill University.
Merger Agreement
Under the terms of the merger agreement, each share of CTD common stock will
convert into the right to receive approximately .271443 of a share of Endorex
common stock and each share of CTD Series A preferred stock will convert into
the right to receive approximately 1.008466 shares of Endorex common stock. An
independent financial advisor retained by Endorex rendered their opinion to
Endorex's Board that the merger is fair to the stockholders of Endorex from a
financial point of view. Endorex will issue approximately 9.4 million shares of
common stock, representing approximately 43% of the currently outstanding common
stock of Endorex, at the closing of the merger and will reserve approximately
0.6 million shares of common stock for issuance upon exercise of CTD options and
warrants assumed by Endorex in connection with the merger. The merger is subject
to the approval of the stockholders of Endorex and CTD, other customary terms
and the satisfaction of certain other conditions. The merger agreement contains
potential $1 million break-up fees which would become payable by either Endorex
or CTD, as applicable, in the event of certain specified occurrences. The merger
agreement prohibits Endorex from directly or indirectly taking certain
actions relating to the solicitation of alternative proposals or offers for
Endorex to acquire other entities, except in limited circumstances, and CTD is
prohibited from directly or indirectly taking certain actions relating to the
solicitation of competing proposals or offers to acquire all or any part of
CTD's stock or assets. The merger is intended to constitute a reorganization
under Section 368 of the Internal Revenue Code of 1986, as amended, and to be
accounted for as a purchase transaction.
Endorex
Endorex is a drug delivery company developing oral and mucosal formulations of
protein- and peptide-based drugs that are traditionally delivered in an
injectable format. Endorex anticipates that this alternative delivery system
will enhance patient quality of life and potentially reduce the overall
healthcare cost related to needle-based delivery. The investment bank of S. G.
Cowen & Co. estimates that sales of protein and peptide-based drugs will reach
$18.5 billion during 2001, with most of the products being sold available only
in an injectable formulation. Endorex's strategy is to work with major
pharmaceutical and biotech companies to convert their existing injectable
products into an oral or mucosal formulation, which Endorex believes can enhance
patient quality of life and compliance and extend the partner company's product
life cycle via access to Endorex's patent portfolio of over 50 issued patents.
For further information regarding Endorex, please visit the company's website
located at www.endorex.com.
CTD
Founded in 1998, CTD is a development stage specialty pharmaceutical company
that develops oral and mucosal formulations of already FDA-approved drugs for
new therapeutic indications. CTD has two products in clinical development. CTD
has 8 issued patents in the U.S. and internationally and an additional 10 patent
applications pending. CTD's investors include TVM TechnoVenture Management,
Nomura Bank and Paul Capital Partners. For further information regarding CTD,
please visit the company's website located at www.corpdevelop.com.
This press release contains "forward looking statements" as defined in the
Private Securities Litigation Reform Act of 1995 regarding Endorex's, CTD's and
the combined companies' plans, expectations, intentions and strategies regarding
the future. These statements include "forward looking statements" about
Endorex's, CTD's and the combined companies' products, product development and
product pipeline. All forward-looking statements included in this release are
based upon information available to Endorex and CTD as of the date of this
release, and neither Endorex, CTD nor the combined companies assume any
obligation to update any such forward-looking statements. These statements are
not guarantees of future performance or results and actual results could differ
materially from current expectations. Factors that could cause or contribute to
such differences include, but are not limited to, product integration risk, the
possibility that the operations and management of Endorex and CTD will not be
successfully integrated, the possibility that the transactions described herein
might not be consummated, the effects of the public announcement on Endorex's
stock price and the progress of certain drug development projects and that
benefits sought to be achieved by the transaction will not be achieved.
Furthermore, Endorex, CTD and the combined companies cannot assure you that they
will be able to successfully develop or commercialize products based on their
technology, particularly in light of the significant uncertainty inherent in
developing drug and drug delivery products, conducting clinical trials and
obtaining regulatory approvals, that their technologies will prove to be safe
and effective, that their cash expenditures will be at projected levels, that
product development and commercialization efforts will not be reduced or
discontinued due to difficulties or delays in clinical trials or due to lack of
progress or positive results from research and development efforts, that they
will be able to successfully patent, register or protect their technology,
trademarks and products, or that the business strategies of Endorex, CTD or the
combined companies will be successful. In addition to the matters described in
this press release, risk
factors as described from time to time in Endorex's filings with the Securities
and Exchange Commission, including, but not limited to, Endorex's most recent
reports on Form 10-QSB, Form 10-KSB, as amended, and Endorex's Registration
Statement on Form S-3, as amended, may affect Endorex's financial results.
Additional Information and Where to Find It: It is expected that Endorex will
file a Registration Statement on SEC Form S-4 and Endorex and CTD will file a
Joint Proxy Statement/Prospectus with the SEC in connection with the
transaction, and that Endorex and CTD will mail a Joint Proxy
Statement/Prospectus to stockholders of Endorex and CTD containing information
about the transaction. Investors and security holders are urged to read the
Registration Statement and the Joint Proxy Statement/Prospectus carefully when
they are available. The Registration Statement and the Joint Proxy
Statement/Prospectus will contain important information about Endorex, CTD, the
transaction, the persons soliciting proxies relating to the transaction, their
interests in the transaction and related matters. Investors and security holders
will be able to obtain free copies of these documents through the website
maintained by the SEC at http://www.sec.gov. Free copies of the Joint Proxy
Statement/Prospectus and these other documents may also be obtained from Endorex
by directing a request by mail to Endorex at 28101 Ballard Drive, Suite F, Lake
Forest, IL 60045-4544, telephone (847) 573-8990, or from CTD by directing a
request by mail to CTD at 1680 Michigan Avenue, Suite 700, Miami, Florida 33139,
telephone 305-777-2258.
In addition to the Registration Statement and the Joint Proxy
Statement/Prospectus, Endorex files annual, quarterly and special reports, proxy
statements and other information with the SEC. You may read and copy any
reports, statements or other information filed by Endorex at the SEC public
reference rooms at 450 Fifth Street, N.W., Washington, D.C. 20549 or at any of
the SEC's other public reference rooms in New York, New York and Chicago,
Illinois. Please call the SEC at 1-800-SEC-0330 for further information on the
public reference rooms.
Endorex's filings with the SEC are also available to the public from commercial
document-retrieval services and at the website maintained by the SEC at
http://www.sec.gov.
Endorex, CTD, directors and certain executive officers of Endorex and CTD,
Paramount Capital, Inc. and certain affiliates and employees of Paramount
Capital, Inc., may be considered participants in the solicitation of proxies in
connection with the merger. Certain directors and executive officers may have
direct or indirect interests in the merger due to securities holdings of Endorex
and CTD and rights to bonus payments following the merger. Paramount Capital,
Inc. and certain affiliates and employees of Paramount Capital, Inc. may be paid
to solicit proxies in connection with the merger and may have direct or indirect
interests in the merger due to their securities holdings of Endorex and CTD. In
addition, certain directors and officers, after the merger, will be indemnified
by Endorex and will benefit from insurance coverage for liabilities that may
arise from their service as directors and officers of CTD prior to the merger.
Additional information regarding the participants in the solicitation will be
contained in the Joint Proxy Statement/Prospectus to be filed by Endorex and CTD
with the SEC.
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