SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of Report (Date of earliest event reported) DECEMBER 31, 1997
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Endorex Corp.
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(Exact name of registrant as specified in its charter)
DELAWARE
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(State or other jurisdiction of incorporation)
0-16929 41-1505029
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(Commission File Number) (IRS Employer Identification No.)
900 NORTH SHORE DRIVE, LAKE BLUFF, IL 60044
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(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (847) 604-7555
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(Former name or former address, if changed since last report)
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TEXT OF PRESS RELEASE
Endorex Corp. and Elan Corporation to Form Exclusive Joint Venture for
Development of Oral and Mucosal Vaccines
Chicago, Illinois, January 5, 1998 -- Endorex Corp. (OTC: ENDR) today
announced that it has signed a binding letter of intent to establish a
joint venture with Elan Corporation, plc (NYSE: ELN) for the exclusive
research, development and commercialization of oral and mucosal prophylactic
and therapeutic vaccines.
The joint venture will combine novel existing and future delivery systems of
the two companies for the development of human vaccines, a $4 billion market
which is projected to increase to $7 billion by 2001, as well as for the
growing veterinary vaccine market.
Orasomal Technologies, a majority owned subsidiary of Endorex, will license
oral vaccine rights to its proprietary Orasome polymerized liposome
technology exclusively licensed from Massachusetts Institute of Technology
(MIT). Unlike conventional liposomes, polymerized liposomes have demonstrated
in animal models an ability to survive the harsh environment of the
gastro-intestinal system, achieve high uptake of the desired encapsulated
vaccine antigens, and elicit strong levels of systemic and mucosal immune
response. This technology was developed by Dr. Robert Langer, Professor of
Chemical and Biomedical Engineering at MIT, and his colleagues. Dr. Langer
is recognized as a leading world expert in the field of drug delivery and
is Co-Chair of the Scientific Advisory Board. Endorex intends to continue to
pursue development of the Orasome technology for oral delivery of
therapeutic proteins and peptides independent of the joint venture with Elan.
"Joining forces with Elan, one of the largest drug delivery companies in the
world, will significantly enhance and accelerate our potential to become a
leading force in the oral and mucosal segment of the vaccine market," said
Michael S. Rosen, President and Chief Executive Officer of Endorex and
Orasomal. According to Rosen, "Due to their greater convenience and ability
to generate systemic as well as mucosal immune protection, oral and mucosal
vaccines will represent the preferred vaccines of the future. We are pleased
that Elan has selected Endorex as their exclusive R&D partner for this
important area."
Said Michael Sember, Executive Vice President of Business Development at Elan:
"We believe the coupling of our broad delivery technologies and experience
with the vaccine expertise of Endorex and Dr. Langer will prove a powerful
combination in the growing vaccine market."
Terms of the Transaction
The joint venture will initially be 80.1 percent owned by Endorex and 19.9
percent owned by Elan. The new entity, yet to be named, will license on an
exclusive basis Elan's drug delivery inventions, intellectual property, and
existing and future patents relating to oral and mucosal delivery
technologies for therapeutic and prophylactic vaccines for humans and
animals. The entity will pay an initial license fee to Elan, plus future
milestones and royalties. Orasomal will also receive milestones and
royalties. In connection with the license agreement and joint venture,
Endorex and Elan have entered into a financing agreement that will result
in Endorex issuing convertible preferred stock to Elan.
As part of the transaction, Elan will make a $2 million initial common stock
investment in Endorex, as well as fund an additional $1.5 million of R&D
activities during the first year of the joint venture, and will continue to
fund JV activities afterward in proportion to its ownership interest. The
common stock is being issued at $6.50 per share. In addition,
Endorex will issue to Elan warrants with a six-year term to purchase
approximately 230,000 shares at $10.00 per share. Elan's expert personnel
in the areas of vaccine and drug delivery, manufacturing and scale-up will
be utilized by the joint venture.
The joint venture is subject to the execution of definitive agreements and
regulatory clearance and is expected to close in the first quarter of 1998.
Endorex intends to provide additional information about the joint venture at
the time of closing.
About Endorex and Elan
Endorex Corp. is a development stage biotechnology company involved in oral
drug delivery, immune response regulation and cancer therapy. Its oral drug
delivery subsidiary, Orasomal Technologies, is developing oral delivery of
vaccines, allergens and therapeutics based on technology licensed from MIT.
Wisconsin Genetics, Inc., another Endorex subsidiary, was recently formed to
develop novel cancer therapy, based on monoterpenes recently licensed from
the Wisconsin Alumni Research Foundation. Endorex is presently also
developing two drugs for cancer and infectious disease: an immunomodulator
and an immuno-adjuvant for vaccines.
Elan Corporation, plc is a leading worldwide drug delivery and
biopharmaceutical company with its principal research and manufacturing
facilities in Ireland, the United States and Israel. Elan's shares trade on
the New York, London and Dublin Stock Exchanges.
The statements made in this press release contain certain forward-looking
statements, including statements concerning the proposed formation of a new
joint venture subsidiary of Endorex, within the meaning of Section 21E of the
Securities Exchange Act of 1934, as amended, that involve a number of risks
and uncertainties, including the risk that Endorex will be unable to complete
the formation of the joint venture and securities sales to Elan. Such
statements are only predictions and actual events or results may differ
materially. In addition to the matters described in this press release, risk
factors as described from time to time in Endorex's SEC reports, including but
not limited to, its most recent reports on Form 10-QSB and Form 10-KSB, may
affect the results achieved by Endorex. The Company assumes no obligation to
update the information in this release.
