Friday, February 10, 2012

Durham stem cell firm Aldagen sold for up to $40 million

Regenerative medicine company Cytomedix (OTC:CMXI) has acquired North Carolina stem cell technology company Aldagen in a $16 million stock deal that broadens the firm’s regenerative therapies pipeline.
Another $25 million in Cytomedix shares also could be awarded to Aldagen investors based on milestones of a clinical trial involving an Aldagen treatment candidate.

Cytomedix shares closed at $1.40 on Wednesday.
AldagenMaryland-based Cytomedix develops biologically active regenerative therapies for wound care, inflammation and blood vessel development. The company has been diversifying to build its regenerative medicine capabilities.
Aldagen’s proprietary ALDH bright cell technology is being used to develop regenerative cell therapies for cardiovascular conditions.Last June, Aldagen enrolled its first patient in a phase 2 clinical trial studying candidate ALD-401 as a treatment for ischemic stroke.
“This strategic acquisition of Aldagen provides Cytomedix with a novel, patent-protected cell selection technology that fits well with our existing commercial products and strengthens our long-range growth profile,” Cytomedix CEO Martin Rosendale said in a prepared statement. “In combination, we now touch the three pillars of regenerative medicine with autologous stem cells, platelet-derived signal molecules and plasma scaffolds.”
Under the terms of the agreement, Cytomedix issued Aldagen shareholders preferred shares valued at $16 million, giving Aldagen an approximately 17.3 percent stake in Cytomedix.
As part of the transaction, some Aldagen investors purchased $5 million of Cytomedix common stock in a private placement.
With the closing of the deal, Aldagen becomes a subsidiary of Cytomedix and will continue to operate from its Durham location.
Lyle Hohnke, Aldagen's former CEO, joins the Cytomedix board.
Aldagen chief operating officer Edward Field has been appointed COO of Cytomedix. Three Aldagen board members now join Cytomedix’s board of directors, which has been expanded to nine seats.
Aldagen stands to gain additional Cytomedix shares — up to 20.3 million — based on milestones tied to the firm’s phase 2 ischemic stroke clinical trial. Under the terms of the deal, 80 percent of those milestones are tied to success in that trial.
Costs of the trial will be funded in part by the $5 million investment made by Aldagen shareholders, $3 million in proceeds from warrants exercised by existing Cytomedix shareholders and some of Cytomedix’s cash on hand.
Venture capital-backed Aldagen has raised more than $60 million from investors including the Aurora Funds, Intersouth Partners, Harbert Venture Partners, CNF Investments and Tullis-Dickerson. The company had taken steps toward an initial public stock offering but last year withdrew those plans citing market conditions.