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AT THE COMPANY:
John Funkhouser, President, CEO
Paul Storey, Director of Finance
(919) 954-9871
INVESTOR CONTACTS:
Lippert/Heilshorn & Associates, Inc.
Bruce Voss (bruce)
(310) 575-4848
Ruth Abeshaus (ruth)
(212) 838-3777
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FOR IMMEDIATE RELEASE
June 17, 1999
PHARMANETICS ANNOUNCES SALE OF COEUR LABORATORIES
RALEIGH, N.C. (June 17, 1999) - PharmaNetics, Inc. (NASDAQ NM: PHAR), the holding company of Cardiovascular Diagnostics, Inc. ("CVDI"), today announced that the Company has entered into a definitive asset purchase agreement to transfer certain assets and liabilities of Coeur Laboratories, Inc. ("Coeur"), a wholly owned subsidiary of CVDI, to Coeur Acquisition, LLC, a private investment firm backed by Bison Investments of Tampa, Florida.
Total consideration for the transaction was approximately $4.2 million. In addition to retaining the cash and receivables, PharmaNetics’ cash position was enhanced as it received $1.8 million for assets of the business, including inventory and other fixed assets. The Company will take a non-cash charge of approximately $800,000 to write off remaining goodwill associated with CVDI’s purchase of Coeur in 1993. The proceeds will be used to facilitate growth in PharmaNetics’ core business of developing rapid specialty diagnostic tests.
Commenting on the sale, John Funkhouser, president and chief executive officer, stated, "This transaction represents another step in the execution of our business strategy. During the last few years, Coeur has provided PharmaNetics with positive cash flow to aid in the funding of the development of rapid coagulation testing. Our plan has been to use Coeur’s revenue to supplement PharmaNetics’ operations. However, we believe it is now necessary to concentrate our efforts and resources on our current diagnostic testing programs. The net proceeds of the sale will be used to help develop and introduce specialty diagnostics based on the versatile TAS system and allow management to continue to build a pipeline of scientific achievements and collaborative relationships."
According to Denise Coryea, general manager of Coeur, "This acquisition provides Coeur with many benefits. We will now be able to dedicate our resources to servicing our primary markets and will ensure continued comprehensive service to our existing customers."
Mr. Funkhouser continued, "I am confident that the new management team’s expertise in injection molding and substantial experience in the manufacturing and distribution of such medical devices will provide Coeur with the additional resources to expand the current product pipeline. Our Coeur employees will benefit by being in an organization that is solely dedicated to manufacturing plastics and instrumentation for the medical industry."
Coeur Acquisition, LLC plans to retain existing Coeur employees and sublet a portion of PharmaNetics’ facility for up to one year or until suitable space can be identified.
PharmaNetics, Inc. develops, manufactures and markets rapid turnaround diagnostics to assess blood clot formation and dissolution. The Company develops tests based on its proprietary, dry chemistry Thrombolytic Assessment System for its principal target market of powerful new drug compounds, some of which may have narrow therapeutic ranges, as well as for monitoring routine anticoagulants. The Company’s therapeutic diagnostics are used to monitor the effect of antithrombotic agents in the treatment of angina, myocardial infarction (heart attack), stroke, deep venous thrombosis, and pulmonary and arterial emboli.
This press release contains forward-looking statements regarding future events and the future performance of PharmaNetics that involve risks and uncertainties, such as risks related to market acceptance, clinical trials and dependence on third-party distributors and collaborative partners that could cause actual results to differ materially from those projected in the forward-looking statements. Information concerning these and other of the factors that could cause actual results to materially differ from those in the forward-looking statements is contained in the Company’s SEC filings, including Form 10-K, Form 10-Q and Form 8-K reports.
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