Australia's Novogen sets up cancer drug company

Novogen, a Sydney, Australia-based firm that is also listed on the USNasdaq, says that it has created a new company, Marshall Edwards, to develop and commercialize phenoxodiol, a new anticancer drug which has now been approved for human clinical trials in the USA (Marketletter February 5).

Marshall Edwards has filed a prospectus with the Australian Securities and Investments Commission to raise $28 million through an initial public offering, prior to seeking a listing on the Australian Stock Exchange. The new entity will have a market capitalization of $280 million, and Novogen will retain up to an 88% stake in Marshall Edwards for at least six months.

The latter's chief executive (and managing director of Novogen), Christopher Naughton, said that the oncology focus of Marshall Edwards would "make strategic or equity partnerships with major pharmaceutical collaborators easier to execute." He added that the newly-created company will also make it easier to access capital markets and, if required, to raise debt or equity going forward. "It will also enable us to target individual geographic territories as discrete market opportunities," Mr Naughton concluded.