SemBioSys Genetics Inc, announced that MannKind Corporation has purchased an option to license rights to SemBioSys' proprietary plant-produced recombinant human insulin. The option period ends on March 31, 2009. Terms of the option stipulate that the primary use of SemBioSys' plant-produced insulin would be for Afresa, MannKind's ultra-rapid acting insulin, which recently completed phase-3 studies.
SemBioSys will receive in total US$2,500,000 from MannKind, which includes the purchase by MannKind of 2,400,000 units of SemBioSys upon closing at a price per unit of US$0.83 (Cdn$1.00). The unit purchase is expected to close on January 5, 2009. Each unit issued by SemBioSys will consist of one common share of SemBioSys and one-tenth of one common share purchase warrant of SemBioSys. Each whole warrant will entitle MannKind to purchase one additional common share of SemBioSys at an exercise price of Cdn$6.00 for a period of 36 months from the effective date of the option.
"This option purchase provides further validation of our plant-produced recombinant human insulin program, and our high volume protein production platform more generally. MannKind is a world class partner focused on the treatment of diabetes that possesses both the clinical and manufacturing expertise, as well as the financial resources, required to bring our plant-produced insulin to market," said Andrew Baum, president and chief executive officer of SemBioSys. "We believe MannKind's Afresa programme has the potential to transform the treatment of diabetes and that our cost-effective production system would provide them with significant cost benefits over existing production methods."
SemBioSys' plant-produced insulin is human insulin produced from genetically enhanced safflower.