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PALATIN
TECHNOLOGIES
NEWS RELEASE
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FOR RELEASE November 12, 1999 at 7:00 AM EST
Contact: Palatin Technologies, Inc.: Molecular Biosystems, Inc.:
Stephen T. Wills Elizabeth Hougen
Chief Financial Officer Chief Financial Officer
609/520-1911 858/812-7179
Joe Allen (investors)
212/698-1360 Patricia Sullivan
JosephAllenIR@aol.com Manager Investor Relations
Lawrence Watts (media) 858/812-7146
773/338-1863 IR@mobi.com
Kari Rinkeviczie (media) or Sherrie Good (media)
Kari@allencaron.com Sherrie@allencaron.com
Allen & Caron Inc. Allen & Caron Inc.
212/698/1360 714/957/8440
FDA-APPROVED PRODUCT ON THE MARKET,
ROBUST PRODUCT PIPELINE
PALATIN TECHNOLOGIES & MOLECULAR BIOSYSTEMS
AGREE TO MERGE
PRINCETON, NJ and SAN DIEGO (November 12, 1999) -- Palatin Technologies Inc.
(Nasdaq PLTN)(Palatin) and Molecular Biosystems, Inc. (NYSE: MB) (MBI) announced
today that the Boards of Directors of both companies have approved a definitive
agreement to merge the two companies to create a stronger company with a broader
product offering and a robust product pipeline. The combined company will keep
the Palatin name and be headquartered in Princeton.
Upon completion of the merger, Palatin will have a Board of Directors comprised
of six members -- four selected from Palatin's existing Board and two selected
from MBI's existing board. Edward J. Quilty, Palatin's Chairman, President and
Chief Executive Officer will continue in his current capacity after the merger
and Bobba Venkatadri, MBI's President and CEO, will serve as a consultant and
remain on the board. The definitive agreement signed yesterday specifies that
the merger is subject to the approval of the stockholders of both companies.
Under the agreement, stockholders of MBI will receive 0.5250 shares of Palatin
common stock for each share of MBI common stock. The stock swap will be
accounted for using purchase accounting. Upon completion of the transaction,
stockholders of Palatin and stockholders of MBI will each own approximately 50
percent of the new company.
The combined Palatin will have one FDA-approved product on the market
(OPTISON(R)), one product which will be filed for FDA clearance later this month
(LeuTech(TM)), and a variety of promising therapeutic and diagnostic agents in
the development pipeline. OPTISON is cleared for ultrasound imaging of the heart
wall and cavity, and LeuTech is an infection imaging agent. Products in
development
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include MB-840, a liver-selective CT imaging agent with therapeutic potential,
and PT-14, Palatin's drug for sexual dysfunction. Both Palatin and MBI have
strategic alliances with Mallinckrodt (NYSE: MKG), and Mallinckrodt has an
equity stake in both companies. In addition, MBI has partnering relationships
with Chugai Pharmaceutical Co., Ltd. of Japan for the commercialization of
OPTISON in Japan, South Korea and Taiwan.
Quilty commented: "The merger makes strategic and business sense for both
companies. We expect the merger will allow us to consolidate functions and, as a
result, reduce operating expenses and leverage our product development and
marketing resources. After this merger, we expect Palatin to have adequate
financial resources to meet its objectives of integrating the two companies and
continuing commercialization of its products. We also intend to investigate
additional acquisitions consistent with this strategy as we move forward."
"We believe combining the Palatin and MBI product pipelines will improve our
chances of bringing multiple approved products to market, generating sustainable
growth in revenue and earnings, and increasing liquidity for our investors,"
Quilty said. He added: "MBI's OPTISON ultrasound contrast imaging agent is
already on the market for its first indication -- enhancement of endocardial
border delineation and left ventricular opacification -- and sales are growing
nicely. Palatin expects to file a Biological License Application (BLA) with the
FDA for the first indication of its lead product, LeuTech, this month. With
Mallinckrodt as our strategic partner for both products, we are extremely
optimistic about their market potential."
Venkatadri commented: "The synergies between the companies are too strong to be
ignored. The combined company will have an excellent product pipeline led by
Palatin's PT-14 therapeutic for treatment of sexual dysfunction and MBI's MB-840
for diagnosing liver tumors. Importantly, OPTISON is expected to enter Phase 3
clinical trials early next year designed to expand its approved indications to
include the detection of myocardial perfusion. Additionally, Phase 3 studies for
OPTISON are expected to begin next year in Japan with our Japanese partner,
Chugai Pharmaceuticals."
Bradley J. Fercho, Mallinckrodt's Imaging Group President, commented, "We wish
Palatin and Molecular Biosystems well as they pursue this new venture. Our
investments in both OPTISON and LeuTech are strategic to Mallinckrodt's focus in
diagnostic imaging. We believe Mallinckrodt's marketing and distribution
resources and expertise can help establish these products as the standard of
care in their respective markets. We look forward to working closely with the
combined Palatin Technologies in continuing to develop the markets."
The companies expect to file proxy materials with the Securities and Exchange
Commission within sixty days, and to notice and hold Special Stockholder
Meetings as soon as proxy materials can be cleared and mailed. They anticipate
that the meetings and the consequent combination will be consummated in the
first quarter of calendar 2000. Palatin and MBI were represented in the
transaction by Hambrecht & Quist LLC and Prudential Vector Healthcare Group, a
unit of Prudential Securities, respectively.
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Based in St. Louis, MO, Mallinckrodt Inc. is a global manufacturer and marketer
of specialty medical products designed to sustain breathing, diagnose disease
and relieve pain. The company does business in more than 100 countries; operates
Respiratory, Imaging and Pharmaceuticals products groups; and had fiscal 1999
net sales of $2.6 billion. The Mallinckrodt web site address is
www.mallinckrodt.com.
MBI is a world leader in developing contrast agents for diagnostic imaging. Its
innovative product, OPTISON, improves diagnosis of heart disease through clearer
ultrasound images. For more information on Molecular Biosystems by fax, dial
888-329-4007, or visit its web site: www.mobi.com.
Palatin Technologies is a development-stage medical technology company involved
in developing and commercializing products and technologies for diagnostic
imaging, cancer therapy and ethical drug development based on its proprietary
monoclonal antibody radiolabeling and enabling peptide platform technologies.
For further information visit the Palatin Web site at www.palatin.com. For
Palatin investor information, visit the Allen & Caron Inc. Web site at
www.allencaron.com.
Statements about the respective Companies' and/or the combined Companies' future
expectations, including closing of the acquisition, product development, the
quality of product portfolios, synergies, regulatory plans, timing of FDA
reviews, FDA clearances, sales volumes, market acceptance of products and all
other statements in this document other than historical facts, are
"forward-looking statements" within the meaning of Section 27A of the Securities
Act of 1933, Section 21E of the Securities Exchange Act of 1934 and as that term
is defined in the Private Securities Litigation Reform Act of 1995. The
Companies intend that such forward-looking statements be subject to the safe
harbors created thereby. Since these statements involve risks and uncertainties
and are subject to change at any time, the Companies' actual results could
differ materially from expected results.
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