Exhibit 99.1
Gene Logic Agrees to Sell Genomics Assets
Reinforced Commitment to Drug Repositioning and Development
Business
GAITHERSBURG, Md.--(BUSINESS WIRE)--Oct. 15, 2007--Gene Logic Inc.
(NASDAQ: GLGC) announced today that it had signed an agreement to sell
its Genomics assets to Ocimum Biosolutions Ltd., a global life
sciences R&D enabling company. Under the agreement, Gene Logic will
exchange its genomics assets to Ocimum for $10 million cash, of which
$7 million is to be paid at closing and $3 million is payable pursuant
to a promissory note due 18 months from the date of closing. The
purchase price is subject to adjustment based on certain potential
revisions to the balance sheet at date of closing. Additionally,
Ocimum will assume certain liabilities associated with the Genomics
assets and business. Consummation of the sale is subject to certain
conditions, including the approval of the Gene Logic shareholders who
will be asked to authorize this transaction at a special meeting to be
held for that purpose.
"This is a transforming event of significant strategic
proportion," said Charles L. Dimmler, III, President and Chief
Executive Officer of Gene Logic. "This agreement stands as another
major milestone on the Company's path to build a drug repositioning
and development business. This event represents the culmination of a
rigorous assessment of the Company's business strategy undertaken last
year and that led, as a first step, to the sale of the Company's
Preclinical Division. Today's event marks a turning point in the
transitional phase of Gene Logic's strategic redesign. It enables the
Company now to execute with singular focus: to concentrate its
proprietary know-how in this newly emerging segment of drug
development, a business the Company believes will produce great value
potentially for our shareholders."
Gene Logic's development work is focused now on its clinical stage
small molecule drug candidate, GL1001, to which it holds commercial
rights. The Company has repositioned this drug candidate to treat
gastrointestinal disease, and it is preparing to manufacture a
research grade drug supply and to file an Investigational New Drug
(IND) application so that additional clinical trials might be
conducted in the United States. In August, the Company announced
positive in vivo model results for GL1001 in inflammatory bowel
disease (IBD). The global market opportunity for IBD is estimated to
exceed $1 billion per annum. The unmet need in this therapeutic area
offers the Company significant opportunity for value creation. Gene
Logic is developing GL1001 actively while pursuing potential
partnerships with intent to maximize the full commercial potential for
this drug candidate in gastrointestinal disorders.
Over the past three years, Gene Logic has refined its
indication-seeking program with positive effect for its own compound,
GL1001, in addition to certain compounds provided to the Company by
its pharmaceutical company partners. To date, Gene Logic has reported
to its partners approximately one new hypothesis for every three
compounds introduced for evaluation. These partners include Pfizer,
Roche, Abbott, Merck Serono, Organon, Solvay, and H. Lundbeck.
Under the terms of the Ocimum sale agreement, Gene Logic retains
full rights in perpetuity to utilize the existing information data
bases of its former Genomics business as key elements in building its
emerging drug repositioning and development business. Furthermore, the
Company will retain specified assets related to molecular diagnostics
and will continue to explore strategic alternatives for these assets.
Gene Logic's decision to sell its Genomics business resulted from
a comprehensive review of alternatives reasonably accessible to the
Company with respect to these assets. Assisted by its investment
bankers, the Company conducted an intensive campaign over several
months time to identify and evaluate a range of alliance or sale
alternatives.
Aquilo Partners acted as financial advisor to Gene Logic in this
transaction.
Gene Logic Overview
Gene Logic's indication discovery technologies are currently
applied at the Company's facilities in Cambridge, MA on behalf of a
number of top pharmaceutical companies. These companies have provided
compounds which have failed advanced clinical studies for reasons
other than safety. Headquartered in Gaithersburg, Maryland, the
Company operates a rediscovery and development facility in Cambridge,
Massachusetts.
Safe Harbor Statement
This press release contains "forward-looking statements," as such
term is used in the Securities Exchange Act of 1934, as amended. Such
forward-looking statements include the Company's ability to identify
strategies for making its businesses successful and the impact of such
strategies on our business and financial performance and on
shareholder value. Forward-looking statements typically include the
words "expect," "anticipate," "believe," "estimate," "intend," "may,"
"will," and similar expressions as they relate to Gene Logic or its
management. Forward-looking statements are based on our current
expectations and assumptions, which are subject to risks and
uncertainties. They are not guarantees of our future performance or
results. Our actual performance and results could differ materially
from what we project in forward-looking statements for a variety of
reasons and circumstances, including particularly such risks and
uncertainties that may affect the Company's operations, financial
condition and financial results and that are discussed in detail in
the Company's Annual Report on Form 10-K and our other subsequent
filings with the Securities and Exchange Commission. They include, but
are not limited to: whether we will be able to identify and
successfully implement strategies, on favorable terms or at all, for
realizing the value of our Genomics business, including through a sale
of all or part of the Company's Genomics business, whether
repositioned compounds are successfully returned to our customers'
pipelines and generate sales, resulting in milestone payments and
royalties for the Company or whether we acquire on acceptable terms
rights to repositioned compounds that our partners decline to develop
and are able to derive revenue from these compounds through licensing
or otherwise, whether we can enter into agreements to develop
sufficient compounds to fulfill our plans for the Drug Repositioning
Division; whether there will be any claims associated with the sale of
the Pre-Clinical Division, whether we will be able successfully to
manage our existing cash and have access to financing on sufficiently
favorable terms to maintain our businesses and effect our strategies,
including development of repositioned compounds; whether we will be
able to recruit and retain qualified personnel, particularly in light
of our restructuring efforts; potential negative effects on our
operations and financial results from workforce reductions, other
restructuring activities, and the evaluation of strategic options; the
potential loss of significant customers; the possibility of further
write-down of the value of certain intangible assets of the Company,
including goodwill associated with the Genomics Division; and the
possibility of delisting from NASDAQ Global Markets, which could have
an adverse effect on the value of our stock. Gene Logic undertakes no
obligation to update or revise any forward-looking statements, whether
as a result of new information, future events or otherwise.
CONTACT: Gene Logic Inc.
Investors:
Philip L. Rohrer, Jr., 301-987-1700
Chief Financial Officer
prohrer@genelogic.com
or
Partnering Opportunities:
Bethany Mancilla, 301-987-1700
Vice President, Business Development & Licensing
bmancilla@genelogic.com
or
Investors and Media:
Christopher Culotta, 301-987-1752
Senior Director, Strategic Communications
cculotta@genelogic.com