CombinatoRx to merge with Canadian firm - Boston Business Journal:

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Under the terms of the agreement, Mass.-based CombinatoRx will issus shares of common stock to Neuromed stockholdersso that, post each companies’ shareholders will have 50 percent of the voting power in the combinedx company. The deal is closely tied to a recen t transaction that saw Neuromed sell the commercial rights toits pain-management drug candidate Exalgo to , a subsidiary of That agreemenft included an upfront payment of $15 million and several potential milestone payments and related compensation if certainm commercial benchmarks are met. Thosse payouts also could alter the ownershiop composition of the newlumerged company.
For example, if Exalgo is approvexd by thebefore 2010, CombinatoRx shareholderas will see their ownership stake in the combined company slip to 30 If the drug does not win FDA approvao by 2011, CombinatoRx shareholders will then assume a 70 percenyt ownership stake in the company, according to regulatory filings. Alexisx Borisy will step down as presidenyt and CEO of CombinatoRx to pursueotherr activities.
Borisy will supportt CombinatoRx as a member of its scientificadvisorgy board, according to the The boards of directors of both CombinatoRcx and Neuromed have approved the proposed merger transaction, whichn is subject to customary closingg conditions, including receipt of various required approvals from the CombinatoRz and Neuromed stockholders. In May, CombinatoRx CRXX) said it narrowed its net loss for the firsyt quarter amid aggressive cost cutting that included laying off almos t half its staff and slashes to its researcyh anddevelopment budget.