BASKING RIDGE, N.J., May 18, 2017 (GLOBE NEWSWIRE) -- Caladrius Biosciences, Inc. (NASDAQ:CLBS), a clinical stage development company with a cell therapy pipeline focused on immune modulation and select cardiovascular indications, announces that Company has closed on the sale of its remaining 80.1% ownership interest in its PCT subsidiary to Hitachi Chemical Co. America, Ltd. for $75 million in cash, subject to certain adjustments, including based on PCT’s cash and outstanding indebtedness as of the Closing Date and a potential future milestone payment.
Caladrius received $5.0 million of the Purchase Price upon the signing of the Interest Purchase Agreement (the “Purchase Agreement”) on March 16, 2017. The remainder of the Purchase Price was paid as follows:
- $60.1 million was paid to Caladrius, taking into account the Purchase Price adjustments based on PCT’s cash and outstanding indebtedness as of the Closing Date;
- $5.0 million (the “Escrow Amount”) was deposited into an escrow account to cover potential indemnification claims against the Company pursuant to the terms of the Purchase Agreement;
- $4.9 million was used to pay off the remaining balance owed pursuant to the loan and security agreement, dated as of September 19, 2014, among Oxford Finance LLC, as collateral agent and lender, the Company and certain subsidiaries of the Company.
In addition, Hitachi will pay the Company $5.0 million (the "Milestone Payment") if PCT achieves $125 million in Cumulative Revenue (excluding clinical service reimbursables) for the period from January 1, 2017 through December 31, 2018 (the “Milestone Period”). For purposes of the Milestone, “Cumulative Revenue” will be calculated based on PCT’s revenue from all customers (including the Company and its subsidiaries) in accordance with the financial accounting and reporting standards set forth in the statements and pronouncements of the Financial Accounting Standards Board, consistently applied. There can be no assurance that such Milestone Payment will be earned or received.
The Escrow Amount is expected to be released on June 17, 2018 (the “Escrow Release Date”), subject to indemnification claims, if any, that are paid prior to or that exist on the Escrow Release Date.
“We are delighted to close this transformative transaction for Caladrius and now turn our attention to moving forward with our clinical development plans,” stated David J. Mazzo, PhD, President and Chief Executive Officer of Caladrius Biosciences. “We look forward to continuing to work with PCT, a Hitachi Group Company, as our partner and as the preferred provider for the manufacture of CLBS03, our lead product candidate currently in a Phase 2 clinical trial for the treatment of type 1 diabetes.”
About Caladrius Biosciences
Caladrius Biosciences, Inc. is a clinical stage development company with cell therapy products in development based on multiple technology platforms and targeting autoimmune and select cardiology indications. The Company is investigating its lead product candidate, CLBS03, an ex vivo expanded polyclonal T regulatory cell therapy for the treatment of recent-onset type 1 diabetes in a currently enrolling Phase 2 trial. For more information on Caladrius please visit www.caladrius.com.
