Retrophin Proposes Acquisition of Transcept for $4.00 Per Share
NEW YORK--(BUSINESS WIRE)--
Retrophin, Inc. (OTCQB:RTRX) today announced that it has made a proposal
to the Board of Directors of Transcept Pharmaceuticals, Inc.
(Nasdaq:TSPT) to acquire all of the shares of Transcept common stock
that Retrophin does not own for $4.00 per share in cash. Retrophin's
proposal is conditioned on the completion of cursory due diligence and
other customary provisions. Retrophin's proposal is not subject to a
Last week, Retrophin delivered a letter to Transcept's Board of
Directors proposing to acquire all of the outstanding common stock of
Transcept for $3.50 per share in cash. Transcept's Board of Directors
rejected Retrophin's proposal and adopted a Tax Benefit Preservation
Plan (a/k/a a "Poison Pill") that prevents stockholders from acquiring
more than 4.99% of Transcept. In recent weeks, three of Transcept's
major stockholders have publicly stated their disapproval of Transcept's
current strategy. Retrophin's proposed all-cash offer would provide an
immediate exit for Transcept's stockholders at a 20% premium to
Transcept's current stock price.
Retrophin expressed its disappointment that the Board of Directors and
management of Transcept have not been willing to engage with Retrophin
to ascertain the benefits of the proposal. "Our proposal represents an
attractive premium to Transcept's trading performance, and we believe
that the proposal offers a compelling opportunity for Transcept's
stockholders, particularly in light of Transcept's risky and
controversial acquisition strategy," stated Martin Shkreli, Chief
Executive Officer of Retrophin. "We hope that Transcept's Board of
Directors will respect its stockholders' wishes and quickly commence
discussions with us regarding the proposed transaction."
Retrophin's letter called on the Board of Directors of Transcept to
engage in discussions with Retrophin and to provide it with access to
selected due diligence in order to enter into a transaction no later
than September 30, 2013 (see letter attached).
Retrophin is a pharmaceutical company focused on the discovery and
development of drugs for the treatment of debilitating and often
life-threatening diseases for which there are currently no viable
patient options. The Company is currently focused on several
catastrophic diseases affecting children, including Focal Segmental
Glomerulosclerosis (FSGS), Pantothenate Kinase-Associated
Neurodegeneration (PKAN), Duchenne Muscular Dystrophy and others.
Retrophin's lead compound, RE-021, is scheduled to begin enrollment in a
potentially pivotal Phase 2 clinical trial for FSGS during 2013. For
additional information, please visit www.retrophin.com.
This press release contains "forward-looking statements" as that term is
defined in the Private Securities Litigation Reform Act of 1995,
regarding the research, development and commercialization of
pharmaceutical products. Such forward-looking statements are based on
current expectations and involve inherent risks and uncertainties,
including factors that could delay, divert or change any of them, and
could cause actual outcomes and results to differ materially from
current expectations. No forward-looking statement can be guaranteed.
Forward-looking statements in the press release should be evaluated
together with the many uncertainties that affect the Company's business.
The Company undertakes no obligation to publicly update any
forward-looking statement, whether as a result of new information,
future events, or otherwise.
777 Third Avenue, 22nd Floor
New York, NY 10017
September 18, 2013
The Board of Directors
Transcept Pharmaceuticals, Inc.
Cutting Blvd., Suite #110
Point Richmond, California 94804
Members of the Board:
I am writing on behalf of Retrophin, Inc. ("Retrophin") to express our
disappointment that the Board of Directors of Transcept Pharmaceuticals,
Inc. ("Transcept"), rejected our all-cash proposal to acquire all of
Transcept's outstanding common stock at a price of $3.50 per share, that
was outlined in our September 10th letter to you. Rather than
discuss our proposal or attempt to negotiate for a greater premium for
Transcept's stockholders, Transcept's Board of Directors approved a Tax
Benefit Preservation Plan, a/k/a a "Poison Pill". We are puzzled by that
decision, particularly due to (i) the 20% premium to Transcept's current
market price that our proposal represents and (ii) the opposition
expressed by Transcept's stockholders to Transcept's risky and highly
speculative stated strategy to grow Transcept through acquisitions.
Although Transcept rejected our initial proposal, we are formally
proposing to Transcept's Board of Directors that Retrophin acquire all
of the outstanding shares of common stock of Transcept for $4.00 per
share in cash.
Notwithstanding Transcept's lack of engagement with us and the
implementation of its Poison Pill, we and our advisors have continued to
analyze Transcept's publicly available information and assess the
potential benefits of an acquisition of Transcept. As we mentioned in
our September 10th letter, due to the significant value that
we believe that Transcept represents, we may be willing to further
increase our proposed purchase price if (i) we are allowed the
opportunity to conduct due diligence and such diligence validates
certain understandings about Transcept and its prospects and (ii) we are
able to negotiate a definitive acquisition agreement containing
customary representations, warranties, covenants and closing conditions.
We and our advisors are prepared to begin the due diligence process
immediately. Additionally, we continue to support, and are willing to
participate in, an open and efficient auction process managed by
Transcept's financial advisor.
Despite public and private protests from Transcept's largest
stockholders, Transcept's Board of Directors continues to pursue a
strategy of searching for an acquisition to revitalize Transcept. Our
proposed all-cash offer provides an immediate exit for Transcept
stockholders at an attractive premium. As a stockholder of Transcept, we
believe that our proposed transaction properly recognizes the true value
If Transcept is interested in pursuing our proposal in order to benefit
its stockholders, we and our representatives are prepared to move
quickly towards definitive documentation. Our proposal will remain open
until September 30, 2013, which we believe to be an adequate time to
perform due diligence and enter into an agreement if Transcept is
willing to engage itself and commit the necessary resources.
We intend to make this proposal public promptly after the delivery of
this letter because we believe that Transcept's stockholders have the
right to consider this improved proposal, to learn about the refusal of
Transcept's Board of Directors to engage us, and to understand that the
Board of Directors is placing our proposal at risk by refusing to engage
with us on a timely basis.
We continue to stand ready to meet with the Board of Directors and its
advisors immediately to discuss our proposal and to devote all necessary
resources to work to consummate this transaction by November 1, 2013.
Very truly yours,
/s/ Martin Shkreli
Chief Executive Officer
Marc Panoff, 917-261-3684
Paula Schwartz, 917-322-2216
Source: Retrophin, Inc.
News Provided by Acquire Media
Close window | Back to top