Angiotech denied funding after poor revenue performance
This article was originally published in Scrip
Executive Summary
Angiotech Pharmaceuticals, a Canadian pharmaceutical and medical device company, is facing an uncertain future after being unable to secure funding. It has informed potential investors Ares Management and New Leaf Venture Partners that it is unlikely to be able to meet the terms of a proposed deal that would have secured a $200-300 million investment in the company. Angiotech did not have the minimal level of cash and cash equivalents required at the time of the transaction's close. This was largely due to lower than expected revenue fromBoston Scientific, for whom Angiotech makes the coating for drug eluting coronary stents. As a result, the company has increased reorganisational efforts that were announced in April. These include the closure of its research and manufacturing facility in Rochester, New York, postponement of certain preclinical-stage research activities and the reduction of certain financial and personnel contributions relating to its joint venture withGenzyme. Angiotech's share price dropped below $1 after the announcement and closed at just $0.59 on September 23rd.