RegeneRx Closes Previously Announced Financing
REGENERX BIOPHARMACEUTICALS, INC. (AMEX:RGN) (www.regenerx.com) announced today that it closed a previously announced sale to affiliates of its largest shareholder, Sigma-Tau Finanzaria S.p.A, of 5,000,000 shares of the Company’s common stock at a price per share of $1.00 (the “Shares”), for gross proceeds of $5,000,000 (the “Offering”). On February 27, 2008, the Company announced that it had entered into a definitive agreement with respect to this Offering. In connection with the Offering, the Company also agreed to issue warrants to purchase an additional 1,000,000 shares of its common stock with an exercise price of $1.60 per share (the “Warrants”).
“While we considered several opportunities to raise capital through traditional means, the terms of this transaction were clearly more favorable and less dilutive than we could have otherwise obtained. Additionally, these unique buy-back terms provide financing flexibility if and when our Phase II clinical trials report data that is favorably received by the financial markets. Further, these newly issued unregistered shares will be held by long-term affiliates and will, thus, not be traded in the near future,” stated C. Neil Lyons, RegeneRx’s chief financial officer.
There were no discounts or brokerage fees associated with the Offering. As previously announced, under the terms of the transaction, the Company may, in its sole discretion, repurchase the common stock at any time until December 31, 2010 for $2.00 or $2.50 per share, depending on when such purchase is made. In addition, the purchasers have agreed to vote their shares with management until December 31, 2010. The Warrants have a term of three years. One-third of the warrants vested on closing. An additional one-third will vest on December 31, 2008 and the final one-third on December 31, 2009. Should the Company repurchase all of the Shares, any unvested Warrants will immediately expire.
About RegeneRx Biopharmaceuticals, Inc.
RegeneRx is focused on the discovery and development of novel molecules to accelerate tissue and organ repair. Currently, RegeneRx is developing three drug products, RGN-137, RGN-259 and RGN-352 for dermal, ophthalmic, and cardiovascular wound healing, respectively. These drug products are based on Tβ4, a 43-amino acid peptide, in part, under an exclusive world-wide license from the National Institutes of Health. Preliminary research suggests that Tβ4 may prove efficacious for multiple indications; therefore, RegeneRx is developing several drug products as part of a broad therapeutic platform. RegeneRx holds over 60 world-wide patents and patent applications related to dermal, ocular, and internal wounds and tissue repair, cardiac and neurological protection and injuries, septic shock and several consumer product areas. RegeneRx is currently sponsoring three Phase II chronic dermal wound healing clinical trials, a Phase II ophthalmic wound healing clinical trial, and a Phase I parenteral clinical trial in support of systemic administration of Tβ4 for its cardiovascular clinical development program.
The RegeneRx Technology Platform
Tβ4 is a synthetic version of a naturally occurring peptide present in virtually all human cells. It is a first-in-class drug candidate that promotes endothelial cell differentiation, angiogenesis in dermal tissues, keratinocyte migration, collagen deposition, and down-regulates inflammation. One of Tβ4′s key mechanisms of action is its ability to regulate the cell-building protein, actin, a vital component of cell structure and movement. Of the thousands of proteins in cells, actin represents up to 10% of the total protein and, thus, plays a major role in the physiology of the cell. RegeneRx has identified several molecular variations of Tβ4 that may affect the aging of skin, among other properties, and could be important candidates as active ingredients in pharmaceutical and consumer products. Researchers at the National Institutes of Health, and at other academic institutions throughout the U.S., have published numerous scientific articles indicating that Tβ4 is effective in accelerating dermal and corneal wound healing in several animal models, under a variety of conditions. In two articles published in the scientific journal, Nature, researchers found that Tβ4 protects heart tissue following a myocardial infarction and can regenerate coronary vessels in laboratory animals. A recent abstract presented at an American Heart Association meeting showed that in a porcine model Tβ4 is cardio-protective after reperfusion following ischemic injury. Abstracts of scientific papers related to Tβ4′s mechanisms of action may be viewed at RegeneRx’s web page: www.regenerx.com.
Safe Harbor Statement
The information in this press release may include certain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These statements concern the Company’s current expectations regarding future events, including the ongoing and prospective development of Tβ4 and possible future benefits to the Company, its shareholders, and patients. Due to the nature of product development and the regulatory approval process, the forward-looking statements are subject to risks and uncertainties, including those reflected in the Company’s filings with the Securities and Exchange Commission, particularly its most recent Annual Report on Form 10-K. Any forward-looking statements are made pursuant to Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, and, as such, speak only as of the date made. The Company assumes no obligation to update or revise any forward-looking statements made herein or any other forward-looking statements made by the Company.