Cell Genesys, BioSante complete merger; BioSante assumes obligations for 3.125% convertibles

By Jennifer Chiou

New York, Oct. 14 - Cell Genesys, Inc. and BioSante Pharmaceuticals, Inc. announced the successful completion of their previously announced merger of Cell Genesys with and into BioSante, with BioSante as the surviving company.

BioSante now has acquired all of the outstanding shares of Cell Genesys.

Due to the merger, the payment obligations of Cell Genesys under its 3.125% convertible senior notes due 2011 and 2013 were assumed by BioSante.

According to an 8-K filing with the Securities and Exchange Commission, there was $1.2 million of the 3.125% convertibles due 2011 as well as $20.8 million of the 3.125% convertibles due 2013 outstanding.

Prior to the merger, the 2011 and 2013 notes were convertible into Cell Genesys common stock at a conversion price of $9.10 and $0.68, respectively, and upon the merger, the notes became convertible into BioSante common stock at a conversion price of $49.78 and $3.72, respectively.

According to a company news release, BioSante intends to focus primarily on LibiGel, its testosterone gel in phase 3 clinical development for the treatment of female sexual dysfunction.

"The successful closing of our merger with BioSante provides an impressive array of opportunities to create value from the assets of the combined company," Stephen A. Sherwin, the former chairman and chief executive officer of Cell Genesys, and as a result of the merger, a new director of BioSante, said in the release.

BioSante stockholders own roughly 62% of the combined company, and former Cell Genesys stockholders own roughly 38%.

BioSante stockholders approved the merger on Sept. 30, and former Cell Genesys stockholders authorized the transaction on Wednesday.

Cell Genesys shareholders received 0.1828 of a share of BioSante common stock per share.

Cell Genesys is a South San Francisco, Calif.-based company that develops treatments for cancer. BioSante is a Lincolnshire, Ill., specialty pharmaceutical company focused on developing products for female sexual health, menopause, contraception and male hypogonadism.

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