Schering-Plough Acquires Canji in $54.5 Million Deal

Schering-Plough Corporation, a leading biotechnology company, has announced an agreement to acquire Canji, a privately held gene therapy company, for $54.5 million in Schering-Plough stock and rights to participate in royalties on certain products. This acquisition represents a significant step for Schering-Plough in its commitment to gene therapy research, with Canji's scientists and technology to become the foundation for Schering-Plough's research in this area.

Key Takeaways:

• Schering-Plough will acquire all outstanding equity of Canji, a leading gene therapy company, for $54.5 million in Schering-Plough stock and rights to participate in royalties on certain products.
• The acquisition is valued at over $60 million, considering the 1994 licensing arrangement between Schering-Plough and Canji.
• Canji's proprietary scientific discoveries with p53 gene therapy technology will be developed further by Schering-Plough, with the goal of bringing new cancer treatments to market.
• The acquisition is expected to be completed in the 1996 first quarter, following registration with the Securities and Exchange Commission and approval of the merger by Canji shareholders.
• Schering-Plough's primary development efforts with respect to Canji will continue to focus on p53 gene therapy, with additional work on tumor suppressor genes that may be important in the treatment of various cancers.
• The p53 gene functions as a tumor suppressor, producing apoptosis in tumors, and reintroduction of a normal p53 gene into a malignant cell has been shown to reverse the cell's malignant state.
• Approximately 50 percent of all human cancers are associated with defective p53 genes, making the p53 gene a crucial target for cancer therapy.

Statistics:

• $54.5 million: the value of the acquisition,
• 8.5 percent: the minority equity stake held by Schering-Plough in Canji prior to the acquisition,
• 1994: the year of the licensing arrangement between Schering-Plough and Canji,
• 50: the percentage of Canji employees,
• 1990: the year Canji was founded,
• 50 percent: the percentage of human cancers associated with defective p53 genes,
• 1996: the expected year of clinical testing with the p53 gene,
• $60 million: the estimated value of the acquisition, considering the 1994 licensing arrangement.

Sources:

• PRNewswire, "Schering-Plough Corporation and Canji, Inc. Announce Acquisition Agreement" (Dec. 12, 1995)
• Schering-Plough Corporation press release, "Schering-Plough Corporation and Canji, Inc. Announce Acquisition Agreement" (Dec. 12, 1995)
• Schering-Plough Corporation website, "Schering-Plough and Canji Announce Acquisition Agreement" (Dec. 12, 1995)