Merlin Nexus And New Leaf Venture Partners Continue To Contest Proposed $56 Million Acquisition Of Icagen By Pfizer

NEW YORK, Aug. 25, 2011 /PRNewswire/ -- Merlin Nexus and New Leaf Venture Partners (NLV Partners) have contested the terms of Icagen's (Nasdaq: ICGN) proposed acquisition by Pfizer Inc (NYSE: PFE) in a letter filed today with the SEC.  According to a July 20, 2011 press announcement, Pfizer plans to purchase the shares of Icagen stock it already does not own at a price of $6.00 per share, resulting in an aggregate transaction value of approximately $56 million.  In the past month, Merlin Nexus and NLV Partners, both stockholders in Icagen, have sent two letters to the Icagen Board contesting the price of the acquisition.  The current letter affirms that the "terms of the proposed Pfizer acquisition do not reflect the fair value of Icagen's assets."  Further, both stockholders expressed their disappointment "that the Icagen acquisition was announced ahead of near-term milestones, and [they] do not intend to tender [their] shares under the current terms."

In the current letter, Merlin Nexus and NLV Partners state that "the true cost to Pfizer to acquire the company's assets is only $22 million when near-term R&D and milestone payments as well as the cash Icagen currently owns are put into the equation.  This cost would be even lower if the Pfizer-Icagen R&D collaboration were renewed after it expires later this year."

The letter references conservative estimates of the value of Icagen's pain programs alone at as much as $100-$165 million or $11-$19 a share.  Unfortunately, as noted in the letter, "Icagen's Board chose not to pursue other strategic options that could have allowed the pain programs currently partnered with Pfizer to reach significant milestones and create additional value for all shareholders."

Pfizer advanced the first of Icagen's proprietary compounds (PF-05089771) into a phase I single dose escalation study in December 2010, and this trial was expected to have been completed in March 2011.  According to the letter, "trial data are open to Pfizer as they are required to monitor safety.  These data provide Pfizer with an unfair advantage not afforded to all investors to determine the value of this program."

The letter concludes as follows:  "We are not opposed to the acquisition of Icagen by Pfizer at a fair price, but ask for a fair process under which the information held by Pfizer is shared so all Stockholders can make an informed decision.  If Pfizer chooses to keep the details of its partnered programs confidential, based on publicly available information we have to assume the data must be positive and could potentially lead to a commercial opportunity with significant milestones and royalties worth much more than the current price being offered by Pfizer."

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