ADMA Biologics Inc. agreed to acquire certain manufacturing and therapy-related assets from Biotest Pharmaceuticals Corp., a Biotest AG subsidiary.
ADMA will pay Biotest Pharmaceuticals 50% of its capital stock, less one share consisting of voting common stock equal to 25% of the issued and outstanding common stock of ADMA and non-voting common stock representing the balance of such 50% equity interest, less one share.
The company will also grant Biotest Pharmaceuticals the right to designate one director and one observer to its board. In addition, ADMA will transfer the ownership of its two plasma centers in Norcross and Marietta, Ga., effective Jan. 1, 2019.
Biotest AG will maintain its existing distribution rights granted for RI-002, ADMA's lead product candidate, in Europe, Near and Middle East and selected other territories and a right of first offer to Biotest Pharmaceuticals for the distribution of potential future ADMA developed plasma-based products in the territories.
The assets included in the acquisition include property, facilities, laboratories, equipment and certain employees of Biotest Pharmaceuticals' locations in Boca Raton, Fla., FDA-licensed product portfolio including Nabi-HB and BIVIGAM, and contract manufacturing and services agreement for a third party's licensed hyperimmune globulin product.
Biotest will provide ADMA with cash consideration totaling up to $40 million, consisting of a $12.5 million in cash upon closing, a $15 million unsecured subordinated loan at a 6% percent per annum interest rate, and interest only through the life of the loan and final principal payment due in full at the end of the five-year loan period, along with a firm equity commitment to invest an additional $12.5 million in future equity financings of ADMA.
ADMA and Biotest Pharmaceuticals will enter into a standstill, which will limit Biotest's ability to control the company. Biotest also agreed to a six-month lock up of the sale of ADMA securities.
The transaction is expected to close in the first half of 2017, subject to customary closing conditions, including shareholder approval.