Novogen to Float Marshall Edwards Inc, to Commercialise Anti-Cancer Drugs

A new company, Marshall Edwards, Inc. (MEI) has been formed to develop and commercialise phenoxodiol, a new anti-cancer drug now approved for human clinical trials in the United States. Incorporated in the US state of Delaware, MEI is currently a wholly owned subsidiary of Novogen Limited, the pharmaceutical company listed on the ASX and NASDAQ. MEI has today lodged a prospectus with the Australian Securities and Investments Commission (ASIC), to raise A$55 million as an initial public offering (IPO). If the offer is oversubscribed, the Directors of MEI reserve the right to raise up to a further A$15 million pursuant to the offer. MEI will apply to be listed on ASX. Novogen would retain at least an 88 per cent shareholding in MEI for at least 6 months.

MEI has been granted a licence by the Novogen Group to complete current human clinical trials of phenoxodiol now underway in two Australian hospitals and commence the US clinical trial recently approved by the Food and Drug Administration (FDA), which granted phenoxodiol, Investigational New Drug (IND) status in the US. MEI has also been granted the worldwide rights to distribute and market the drug for all oral and injectable anti-cancer treatments. The licence agreement is conditional on the ASX listing.

The prospectus includes a valuation by Acuity Technology Management of the intellectual property licensed to MEI. In addition to the rights to phenoxodiol for oral and injectable anti-cancer uses, MEI also has certain first and last rights in respect of other anti-cancer compounds developed by or on behalf of the Novogen Group. The chief executive officer of MEI and managing director of Novogen, Mr Christopher Naughton, said the anti-cancer focus of MEI would facilitate the commercialisation of phenoxodiol and make strategic or equity partnerships with major pharmaceutical collaborators easier to execute.

"The creation of MEI will also make it easier to access capital markets and if required to raise debt or equity going forward," Mr Naughton said.

"It will also enable us to target individual geographic territories as discrete market opportunities."

"The advantage for both Novogen and MEI shareholders is that they will now be able to attach a value to phenoxodiol and other compounds in the anti-cancer portfolio."

"While MEI will be the vehicle for commercialising cancer drug candidates including phenoxodiol, Novogen would retain ownership of much of the research and development giving rise to the group's pharmaceutical products," Mr Naughton said.

Prostate cancer is the main cancer target for phenoxodiol. Prostate cancer is the second most common diagnosed cancer in men and is also the second most prevalent cause of cancer death in men.

The demand for a safer and more effective treatment for the disease is increasing as the population ages. The directors of MEI also intend to consider pursuing other cancer types and current human trials include cancer patients with varied advanced cancers.

The directors of MEI are Dr Graham Kelly, chairman; Mr Chris Naughton, CEO; and non-executive directors Mr Philip Johnston, Professor David de Kretser and Professor Paul Nestel.

Professor de Kretser is the director of the Monash University Institute of Reproduction and Development and his team at the Institute performed initial in vitro research on phenoxodiol which expanded its anti-cancer potential.

Professor Nestel is the director of the Nutrition Group, at the Baker Medical Research Institute, in Melbourne. Professor Nestel has conducted clinical research with Novogen compounds with particular focus on arterial health. Dr Kelly and Messrs Naughton and Johnston are also directors of Novogen Limited.

Australian resident shareholders of Novogen Limited on the register as at the close of business on Wednesday 2 May 2001 will be given a priority to participate in the MEI share offer. Details of that priority are set out in the prospectus.

Brokers to the offer are Taylor Collison Limited and Lonsdale Securities Limited.

The offer is expected to open on 7 May 2001 and remain open for around four weeks. Subject to the required approvals being obtained from ASX, MEI is aiming to list on ASX in mid-June 2001.

The offer of shares in MEI will be made in, or accompanied by, the prospectus dated 27 April 2001 and lodged with ASIC on that date. Anyone wishing to acquire shares will need to complete the relevant application form that will accompany the prospectus. The contents of this announcement represent a summary only of the offer of shares by MEI and investors should read the prospectus carefully in its entirety before deciding to invest in MEI.

<<< back