Apotex' Yorpharm generic injectables marketer and GEN/Rx agree in principle to merge for $20 mil..

YORPHARM, GEN/Rx GENERIC INJECTABLES FIRMS WILL MERGE FOR ABOUT $20 MIL. based on the recent trading prices of GEN/Rx's 5.2 mil. shares outstanding. Under the definitive agreement announced Jan. 27, GEN/Rx will issue approximately 13 mil. shares of common stock in exchange for 100% of Yorpharm's shares plus $3 mil. in cash. The merger is dependent upon completion of certain due diligence and the approval of both companies' boards. The deal is forecast to close tentatively on Feb. 8.

Dana Point, Calif.-based Yorpharm is Apotex-USA's affiliate hospital sales generic injectables marketer. The parent firm is the Canadian generic drug manufacturer and marketer Apotex, Inc. Apotex also owns 68% of Barr Labs. The companies reached a letter-of-intent stage agreement with Fort Collins, Colo.-based GEN/Rx in September ("The Pink Sheet" Sept. 19, 1994, T&G-3), the terms of which have changed substantially. GEN/Rx is a veterinary drugs injectable drug manufacturer and marketer.

After the proposed merger, Yorpharm President Jeff Yordon will become chairman, president and CEO, and the company will be "a fully integrated" injectable human generics drug company focusing on small volume drugs. According to the letter-of-intent stage deal, the agreement covers 15 human generic injectables for which ANDAs have yet to be filed. Yorpharm also has at least a half-dozen product development and multi-sourcing agreements with other firms, according to the earlier proposal.

To accommodate the Yorpharm products, GEN/Rx's 44,000 sq. ft. manufacturing facility in Fort Collins will be expanded. GEN/Rx President John DeTemple will become the exclusive distributor of GEN/Rx vet products through the newly formed Am-Vet company. GEN/Rx CEO John Toedtman will become a Yorpharm board member and consultant.

Yorpharm and Xechem announced Jan. 31 that they have agreed to develop anticancer injectables as well as other multi-source injectable drugs. Xechem, which recently completed its pilot fermentation plan in New Brunswick, N.J., has the right of first refusal to manufacture products under the agreement; products will be manufactured initially by outside contractors. Yorpharm and Xechem will equally fund R&D and jointly submit ANDAs in the name of each company, Yorpharm said.