Filed by CeNeS Pharmaceuticals plc pursuant to Rule 425
Under the Securities Act of 1933
Subject Company: Cambridge NeuroScience, Inc.
Subject Company Exchange Act File No.: 0-19193
Registration Statement No.: 333-_________
THE FOLLOWING IS THE PRESS RELEASE DISSEMINATED BY
CENES PHARMACEUTICALS PLC ON MAY 23, 2000
NOT FOR RELEASE, DISTRIBUTION OR PUBLICATION IN OR INTO
THE UNITED STATES OF AMERICA, CANADA, AUSTRALIA OR JAPAN
CENES PHARMACEUTICALS PLC ("CENES")
PROPOSED ACQUISITION OF CAMBRIDGE NEUROSCIENCE INC. ("CNSI")
CeNeS, the UK biopharmaceutical company, announces the proposed Acquisition of
US based CNSI for approximately US$44 million, assuming all CNSI Options are
exercised. The consideration will be satisfied by the issue of new CeNeS Shares.
CNSI is a Nasdaq listed neuroscience company based in Cambridge, Massachusetts.
It is engaged in the discovery and development of proprietary pharmaceuticals,
focusing on nerve cell survival and function. CNSI's development programme
includes products to treat neurodegenerative disorders such as multiple
sclerosis, peripheral neuropathies, chronic pain and other degenerative
diseases.
The Acquisition combines two companies focused on central nervous system
disorders and pain control. From an R&D perspective, it broadens CeNeS' product
pipeline, expands its R&D skill base and infrastructure and adds drug discovery
activities in ion channel blockers to CeNeS' proprietary ion channel screening
technology. Strategically, it positions the Company in the US biopharmaceutical
community, and provides a pathway to additional revenue opportunities.
Commenting on the proposed acquisition, Daniel Roach, Chief Executive of CeNeS,
said: "We see major benefits resulting from this combination. It will build a
stronger company with a broader product pipeline, an enhanced skill base and a
substantial intellectual property portfolio, particularly in the very important
arena of ion channels. We are adding a strategic eastern United States location
in the heart of biotechnology innovation, which enables us to market our
products and services to US pharmaceutical companies. Finally, we are gaining
revenue opportunities by adding two major collaborators, Allergan and Bayer, to
an already prestigious list of worldwide life science company partners."
Robert McBurney, President & Chief Executive Officer of CNSI, commented: "We
believe this transaction achieves two very important objectives for CNSI and its
shareholders. First, it enables shareholders to capture the value inherent in
our company with a sustained interest in a larger and stronger entity such as
CeNeS. Second, it enables us to leverage the expertise of both companies to
accelerate the research and development activities towards commercialisation."
PRESS ENQUIRIES:
CENES + 44 (0)1223 266 466
Daniel Roach, Chief Executive
ROTHSCHILD + 44 (0)20 7280 5000
Tony Stuart
HOLBORN PUBLIC RELATIONS + 44 (0)20 7929 5599
John Bick
CNSI + 1 617 225 0600 ext. 114
Robert McBurney, President & CEO
FEINSTEIN KEAN HEALTHCARE + 1 508 553 2869
Theresa McNeely
This announcement is made in the United Kingdom and does not constitute an offer
or invitation to purchase any securities. The offering of new CeNeS Shares to
CNSI Stockholders will be made only by means of a Prospectus / Proxy Statement
which it is anticipated will be distributed to CNSI Stockholders in
approximately 90 days. The documents to be reviewed by the US SEC and the London
Stock Exchange, will include, among other things, pro forma combined financial
information.
The issue of this announcement has been approved by the directors of CeNeS who
accept responsibility for the information contained in it. This announcement has
been approved for the purposes of section 57 of the Financial Services Act 1986
by Rothschild, which is regulated in the UK by The Securities and Futures
Authority Limited, and is acting for CeNeS and no one else in connection with
the Acquisition and will not be responsible to anyone other than CeNeS for
providing the protections afforded to customers of Rothschild nor for providing
advice in relation to the Acquisition.
A registration statement relating to the CeNeS shares to be offered in the
Acquisition will be filed with the US Securities and Exchange Commission.
Investors and security holders are advised to read the prospectus regarding the
business combination transaction referenced in the foregoing information when it
becomes available, because it will contain important information. That
prospectus will be filed with the US Securities and Exchange Commission by
CeNeS. Cambridge NeuroScience currently files, and CeNeS anticipates that it
will file, 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 Cambridge or CeNeS at the SEC's public reference rooms in
Washington, DC, New York, New York and Chicago, Illinois. Please call the SEC at
1-800-SEC-0330 for further information on the public reference rooms. Filings
are also available to the public from commercial document retrieval services and
at the web site maintained by the SEC at "http://www.sec.gov." Investors and
security holders may obtain a free copy of the prospectus and other documents
2
filed by CeNeS by directing such request to CeNeS Pharmaceuticals plc, Compass
House, Vision Park, Chivers Way, Histon, Cambridge, CB4 9ZR United Kingdom.
Attention: Company Secretary. Telephone 44 122-326-6466.
Although not directed to persons in the United States, the following statement
is made in accordance with the US Private Securities Litigation Act of 1995.
This press release, including its Appendices, contains forward-looking
statements concerning future matters, such as the features as well as the
functions of, and markets for, products and services offered by CeNeS and CNSI
and business plans and strategies. These forward-looking statements also include
statements concerning the advantages of the proposed Acquisition; the products
and services to be offered by the Enlarged Group; the benefits of the
Acquisition with regard to CeNeS; and other statements regarding matters that
are not historical. Forward-looking statements are subject to risks and
uncertainties, and actual results might differ materially from the results
discussed in the forward-looking statements. For example, there can be no
assurance that any of the expected advantages of the Acquisition will be
realised. Factors that could cause or contribute to differences in results
include: risks associated with integration of the operations of CeNeS and CNSI;
the effect on the Enlarged Group of the failure to realise the anticipated
benefits of the Acquisition; general conditions in the businesses of the
companies, particularly the success of existing clinical trials; competitive
factors in the industry.
3
NOT FOR RELEASE, DISTRIBUTION OR PUBLICATION IN OR INTO
THE UNITED STATES OF AMERICA, CANADA, AUSTRALIA OR JAPAN
CENES PHARMACEUTICALS PLC ("CENES")
PROPOSED ACQUISITION OF CAMBRIDGE NEUROSCIENCE INC.
("CNSI")
INTRODUCTION
The boards of CeNeS and CNSI announce that they have signed a definitive merger
agreement under which CeNeS has conditionally agreed to acquire CNSI. The total
consideration for the Acquisition, assuming that the CNSI Options are exercised,
is approximately US$44 million, to be satisfied in new CeNeS Shares. The
Acquisition is conditional, inter alia, upon the approval of CeNeS and CNSI
Shareholders. Subject to the satisfaction of certain conditions, it is expected
that the Acquisition will become effective in the last quarter of 2000, due to
the timetable imposed by the US SEC filing requirements.
BACKGROUND
The Acquisition combines two companies to form an Enlarged Group focused on
central nervous system disorders, pain control and drug delivery. The Enlarged
Group will generate revenues from research and development collaborations, drug
delivery / formulation contracts, contract ion channel and molecular biology
services and through the sale of cognitive testing products and services.
The Enlarged Group will have a product pipeline that includes Moraxen, a novel
formulation of morphine that has been submitted for marketing approval to the UK
Medicines Control Agency.
The pipeline will have five different pain programmes: Moraxen for post
operative pain (Phase III) and M6G for post operative pain (Phase II), an opioid
analgesic for cancer breakthrough pain (Phase II), and analgesic tripeptides
(Pre-clinical), sourced from CeNeS, and CNS 5161 for neuropathic pain (Phase II)
sourced from CNSI.
It will also contain a phase II drug for the treatment of stroke and clinical
trials targeting sleep disorders (Phase II in healthy volunteers) and substance
abuse (Phase II) from the CeNeS pipeline. CeNeS will contribute a pre-clinical
research project targeting schizophrenia, and CNSI will contribute pre-clinical
research projects targeting multiple sclerosis and glaucoma. CeNeS' research is
currently focused on Alzheimer's disease and Parkinson's disease, while CNSI is
focused on multiple sclerosis. Both companies have research activities in ion
channels as drug targets.
Within the ion channel field both companies have significant intellectual
property. The Enlarged Group will have CNSI's library of more than 2,000
compounds specifically targeted to ion channels within which there is a
portfolio of 45 issued and 15 pending US patents and CeNeS' proprietary ion
4
channel screening technology which automates the complex process of measuring
electrical currents across cell membranes.
MANAGEMENT
Robert McBurney, formerly Senior Vice President and Chief Scientific Officer of
CNSI, will replace Harry Wilcox as President & CEO of CNSI, although Harry will
remain on the board of CNSI until completion of the transaction. As at 1st July
2000 Neil Clark, currently Group Financial Controller and Company Secretary,
will assume the role of Group Financial Director of CeNeS from David Kirk who is
leaving CeNeS to devote more time to other business interests. David will remain
in a consultancy role until completion of this transaction.
All the remaining directors of CeNeS will continue in their existing positions
in the Enlarged Group. Paul O'Brien, Chairman of CNSI, and Harry Wilcox, former
CEO of CNSI, will be invited to join the board of CeNeS on or shortly after
Completion, as non-executive directors.
The Enlarged Group's headquarters will be in Cambridge, UK.
TERMS OF THE ACQUISITION
Under the terms of the Acquisition Agreement, the total consideration payable to
CNSI Stockholders is approximately US$44 million, assuming that all CNSI Options
are exercised, which will be satisfied by the issue of new CeNeS Shares.
CNSI Stockholders will receive new CeNeS Shares equal to a value of US$2.25 per
CNSI Share under a prescribed formula, as set out in the Acquisition Agreement,
valuing the whole of the current issued share capital of CNSI at approximately
US$41 million. The number of new CeNeS Shares to be issued will be calculated on
the basis of the average closing mid market price of a CeNeS Share over the ten
trading days ending two days prior to the Completion Date (the "Trading Range"),
converted into US dollars by reference to the average exchange rate over each of
those days. The average closing price of a CeNeS Share will be subject to a
minimum and maximum price of US$0.9586 and US$1.3915 respectively.
Based on the closing price of a CeNeS Share of 86 pence and an exchange rate of
US$1.4844:(pound)1 on 19 May 2000 (the latest practicable date prior to this
announcement), assuming all CNSI Options are exercised, CeNeS would be required
to issue approximately 34.5 million new CeNeS Shares, which would represent
approximately 25 per cent. of the Enlarged Group's fully diluted issued share
capital.
The Acquisition, which is expected to become effective in the last quarter of
2000, has been approved by the boards of both CeNeS and CNSI, and is subject to
the approval of their shareholders and certain other conditions.
CeNeS expects to send a circular to its shareholders in approximately 90 days,
following US SEC clearance of the documentation relating to the Acquisition,
providing details of the proposed Acquisition and a notice convening an
extraordinary general meeting.
5
INFORMATION ON CENES
CeNeS is focused on developing drugs for CNS disorders and pain control and the
development of controlled release drug delivery products in a range of
therapeutic areas. The group has l00 staff working from modern research and
manufacturing facilities in Cambridge, England and Irvine in Scotland.
CeNeS applies a commercially driven approach to R&D activities, while seeking to
partner other programmes as appropriate to generate income, share risk and
assist in the validation of the underlying technologies. The CeNeS Group has
clinical programmes for the treatment of stroke, pain, schizophrenia, sleep
disorders and substance abuse.
The portfolio of drug candidates and research projects has been compiled by both
in-licensing agreements and collaborative development programmes. In-licensing
agreements have been signed with Novo Nordisk, Glaxo Wellcome, BTG and Bioglan
Pharmaceuticals. CeNeS is also conducting research through collaborative
programmes into new therapeutic approaches for the treatment of Alzheimer's and
Parkinson's disease.
CeNeS has three revenue generating business units. CeNeS Drug Delivery offers
technologies targeted to meet specific therapeutic needs. These technologies are
exploited through contract formulation and development projects with
pharmaceutical companies. The CeNeS cognition business provides equipment and
services in the area of cognition research. The CeNeS Channelwork business has
expertise in ion channel research and sells contract services to the
pharmaceutical industry. Channelwork is also developing high throughput
screening systems for the testing of ion channel modulators, a valuable resource
in ion channel drug discovery.
Summary financial information, extracted from the audited financial information
for the year ended 31 December 1999, is set out below:
- --------------------------------------------------------------------------------
(pound)'000 Year end to 31 December 1999
- --------------------------------------------------------------------------------
Turnover 31
Operating loss (8,981)
Loss per share (26.8p)
Net assets 39,596
- --------------------------------------------------------------------------------
The summary financial information above includes two weeks results for CeNeS
Limited from the date of completion of the merger with Core Group plc on 13
December 1999.
For more information, visit the CeNeS website at WWW.CENES.COM
INFORMATION ON CNSI
CNSI, based in Cambridge, Massachusetts, USA, is a neuroscience company engaged
in the discovery and development of proprietary pharmaceuticals focusing on
nerve cell function and survival. CNSI is developing products to treat chronic
6
pain and neurodegenerative disorders such as multiple sclerosis and peripheral
neuropathies.
CNSI's technologies include a range of proprietary compounds known as
ion-channel blockers which act on specific nerve cells to modify their activity
or to minimise their destruction in degenerative disorders of the central
nervous system. CNSI's lead ion-channel blocker, CNS 5161, is a potent and
selective NMDA ion-channel blocker being developed to treat neuropathic pain.
CNS 5161 has completed two Phase I studies and was shown to have beneficial
analgesic actions. Other indications targeted by the CNSI's ion-channel drug
discovery efforts include stroke, brain and spinal cord injury, glaucoma and
peripheral neuropathies.
To advance the development of several of its programs, CNSI has entered into two
strategic partnerships. Through a collaboration with Allergan, Inc., a worldwide
leader in ophthalmic products, the companies are jointly discovering sodium
ion-channel blockers, NMDA ion-channel blockers and combination ion-channel
blockers for the treatment of glaucoma. CNSI has also partnered with Bayer, AG
to develop recombinant Glial Growth Factor 2 (GGF2), for the treatment of
neurodegenerative diseases such as multiple sclerosis.
Summary financial information, extracted from the audited financial information
for the year ended 31 December 1999, is set out below:
- --------------------------------------------------------------------------------
US$'000 Year end to 31 December 1999
- --------------------------------------------------------------------------------
Revenues 1,443
Operating loss (4,332)
Loss per share ($0.21)
Net assets 10,016
- --------------------------------------------------------------------------------
For more information, visit CNSI's website at WWW.CAMBNEURO.COM
PRESS ENQUIRIES:
CENES + 44 (0)1223 266 466
Daniel Roach, Chief Executive
ROTHSCHILD + 44 (0)20 7280 5000
Tony Stuart
HOLBORN PUBLIC RELATIONS + 44 (0)20 7929 5599
John Bick
CNSI + 1 617 225 0600 ext. 114
Robert McBurney, President & CEO
FEINSTEIN KEAN HEALTHCARE + 1 508 553 2869
Theresa McNeely
7
This announcement is made in the United Kingdom and does not constitute an offer
or invitation to purchase any securities. The offering of new CeNeS Shares to
CNSI Stockholders will be made only by means of a Prospectus / Proxy Statement
which it is anticipated will be distributed to CNSI Stockholders in
approximately 90 days. The documents to be reviewed by the US SEC and the London
Stock Exchange, will include, among other things, pro forma combined financial
information.
The issue of this announcement has been approved by the directors of CeNeS who
accept responsibility for the information contained in it. This announcement has
been approved for the purposes of section 57 of the Financial Services Act 1986
by Rothschild, which is regulated in the UK by The Securities and Futures
Authority Limited, and is acting for CeNeS and no one else in connection with
the Acquisition and will not be responsible to anyone other than CeNeS for
providing the protections afforded to customers of Rothschild nor for providing
advice in relation to the Acquisition.
A registration statement relating to the CeNeS shares to be offered in the
Acquisition will be filed with the US Securities and Exchange Commission.
Investors and security holders are advised to read the prospectus regarding the
business combination transaction referenced in the foregoing information when it
becomes available, because it will contain important information. That
prospectus will be filed with the US Securities and Exchange Commission by
CeNeS. Cambridge NeuroScience currently files, and CeNeS anticipates that it
will file, 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 Cambridge or CeNeS at the SEC's public reference rooms in
Washington, DC, New York, New York and Chicago, Illinois. Please call the SEC at
1-800-SEC-0330 for further information on the public reference rooms. Filings
are also available to the public from commercial document retrieval services and
at the web site maintained by the SEC at "http://www.sec.gov." Investors and
security holders may obtain a free copy of the prospectus and other documents
filed by CeNeS by directing such request to CeNeS Pharmaceuticals plc, Compass
House, Vision Park, Chivers Way, Histon, Cambridge, CB4 9ZR United Kingdom.
Attention: Company Secretary. Telephone 44 122-326-6466.
Although not directed to persons in the United States, the following statement
is made in accordance with the US Private Securities Litigation Act of 1995.
This press release, including its Appendices, contains forward-looking
statements concerning future matters, such as the features as well as the
functions of, and markets for, products and services offered by CeNeS and CNSI
and business plans and strategies. These forward-looking statements also include
statements concerning the advantages of the proposed Acquisition; the products
and services to be offered by the Enlarged Group; the benefits of the
Acquisition with regard to CeNeS; and other statements regarding matters that
are not historical. Forward-looking statements are subject to risks and
uncertainties, and actual results might differ materially from the results
discussed in the forward-looking statements. For example, there can be no
assurance that any of the expected advantages of the Acquisition will be
realised. Factors that could cause or contribute to differences in results
include: risks associated with integration of the operations of CeNeS and CNSI;
the effect on the Enlarged Group of the failure to realise the anticipated
8
benefits of the Acquisition; general conditions in the businesses of the
companies, particularly the success of existing clinical trials; competitive
factors in the industry.
APPENDIX ONE
DEFINITIONS
Acquisition the proposed acquisition of CNSI by CeNeS
through a merger of CeNeS America Inc., a
wholly owned subsidiary of CeNeS, with and
into CNSI on the terms of the Acquisition
Agreement as described in the announcement
Acquisition Agreement the Agreement dated as of 22 May 2000
between CeNeS, CeNeS America Inc., a wholly
owned subsidiary of CeNeS, and CNSI which
details the terms of the Acquisition
"CeNeS" or "the Company" CeNeS Pharmaceuticals plc
CeNeS Group CeNeS and its subsidiaries prior to
completion of the Acquisition
CeNeS Share ordinary shares of 10p in CeNeS
CeNeS Shareholders holders of existing ordinary shares of 10p
each in CeNeS
CNSI Cambridge NeuroScience Inc.
CNSI Common Stock shares of common stock of US$0.01 par value
in CNSI
CNSI Common Stockholders holders of common stock of US$0.01 par value
in CNSI
CNSI Options options over 1,455,930 CNSI Common Stock
Completion completion of the Acquisition which shall
occur immediately prior to the filing of the
certificate of merger
Completion Date the date upon which Completion occurs
Enlarged Group CeNeS as enlarged by the Acquisition
new CeNeS Shares the new ordinary shares of 10p each in CeNeS
to be issued in connection with the
Acquisition
9
Rothschild N M Rothschild & Sons Limited
US SEC the US Securities and Exchange Commission
US the United States of America
10