Biota and Nabi announce proposed merger

Australian firm Biota Holdings (ASX: BTA) and USA-based Nabi Biopharmaceuticals (Nasdaq: NABI) yesterday announced the signing of an implementation agreement to form a combined company, to be named  Biota Pharmaceuticals, listed on the Nasdaq market and headquartered in the USA.

The accord is to subject to shareholder approval and an independent report confirming the merger to be in the best interest of shareholders. However, news of the proposed merger saw Biota’s shares fall 7.9% to A$0.87 in Australian trading.

The Biota move to the USA is designed to achieve better value recognition and liquidity through a stronger US shareholder base. Following the merger, Biota Pharmaceuticals will have three royalty generating products, the flu treatments Relenza (zanamivir; marketed by GlaxoSmithKline) and Inavir (laninamivir octanoate), and potentially PhosLyra (calcium acetate solution); a $231 million contract with BARDA for the advanced development of laninamivir; a portfolio of clinical and preclinical programs comprising vapendavir, and programs for respiratory syncytial virus, hepatitis C, broad spectrum antibiotic targeting gyrase ; an interest in NicVAX (nicotine conjugate vaccine) and over $100 million in cash.