Ergomed plc to be admitted to AIM market

Fast growing, profitable UK-based drug development services company raises £11 million

London, UK – 9th July 2014:  Ergomed plc (the "Company"), a profitable UK-based company, dedicated to the provision of specialised services to the pharmaceutical industry and the development of new drugs, is to be admitted to the London AIM stock market with a market capitalisation of £46.0million.

The fundraising (the "Fundraising"), led by Oriel Securities Limited, has raised £11 million at a price of 160p per share.  Upon Admission, the Company will complete its acquisition of PrimeVigilance, a leading provider of drug safety and medical information services for a combination of cash and shares (the "Acquisition").

Shares in the Company, under the ticker symbol "ERGO", are expected to start trading at 08:00 on 15th July 2014.

Dr. Miroslav Reljanovic, Chief Executive Officer of Ergomed plc, commented: "The fundraising and Admission to AIM are very important landmarks for Ergomed. We believe that the support shown by our new investors is testament to their understanding of the growth potential of our core services business and the value to be created from our co-development business.

"As an international, profitable and fast growing company with a fifteen year track record of providing global drug development services, Ergomed is well positioned to capitalise on industry trends to outsource drug development services, as well as the continued need for alternative sources of funding for drug development by both mid-cap pharmaceutical and biotech companies.

"This listing provides a great opportunity to expand and accelerate our growth as we look to become one of the leading global providers for rare disease/orphan drug development services, post marketing services and to expand our portfolio of co-development partnerships."

 

Key Statistics

·         Number of New Ordinary Shares to be issued by the Company pursuant to the Fundraising: 6,875,000

·         Gross Proceeds of the Fundraising: £11 million

·         Consideration for the Acquisition: £6 million in cash and 1,875,000 New Ordinary Shares (£3 million at the issue price)

Business Highlights

·         Ergomed is a fast growing, profitable UK-based company, dedicated to the provision of specialised services to the pharmaceutical industry and the development of new drugs

·         Ergomed has a global footprint, operating in over 40 countries across five continents and has more than 60 clients ranging from top 10 pharma companies to  biotechnology companies

·         It has two complementary businesses: (1) The Services Business – a well-established, clinical research business providing services to the pharmaceutical and biotechnology industry; and (2) The Co-Development Business – a growing portfolio of partnerships with pharmaceutical and biotech companies, providing its drug development services on a selected basis in exchange for a carried interest in any revenues attributable to the drug asset, including out-licensing milestones as well as sales of the product

·         Conditional upon Admission, Ergomed will acquire sister company PrimeVigilance, a leading provider of drug safety (pharmacovigilance) and medical information services creating a broader service offering to healthcare companies. PrimeVigilance will continue to operate as an independent, specialised pharmacovigilance and medical information service provider

·         Ergomed has particular expertise in oncology, neurology, immunology and the development of orphan drugs, and believes its approach to clinical trials is differentiated from that of other providers by its innovative Study Site Management model and the use of Study Physician Teams

·         Ergomed has a strong management team and experienced board comprising: Rolf Stahel, Chairman; Dr Miroslav Reljanovic, Founder and Chief Executive Officer; Neil Clark, Chief Financial Officer;  Peter George, Non-Executive Director and Christopher Collins, Proposed Non-Executive Director

·         Ergomed and PrimeVigilance generated £19.2 million pro forma revenue in 2013 (15% CAGR from 2011 to 2013) and has a strong order book of  signed contracts providing good visibility on revenues to the end of 2015 and beyond

·         It has a clear growth strategy to become one of the leading global providers for: (1) Rare disease/orphan drug development services (2) Post marketing services e.g. drug safety and medical information (pharmacovigilance), and (3) Co-development partnerships

The net funds of £9.7 million raised by the Company from the Fundraising will be used as follows:

·         £6 million will be used to acquire PrimeVigilance

·         The balance of the proceeds will be used to fund general working capital expenses.  This will enable existing cash and funds generated by the business to:

o    Grow the Company through targeted acquisitions in selected territories to increase the geographical footprint of Ergomed's operations

o    Acquire a proven data management/biostatistics platform to increase the data management capability of its Services Business

o    Expand Ergomed's rare disease franchise to become one of the leading global providers of clinical trials and consultancy services for these indications, as well as expand further into post-marketing services

For media and all other enquiries, please contact:

Hume Brophy

Mary Clark, Supriya Mathur and Hollie Vile

Tel: +44 203 440 5657

[email protected]

 

Oriel Securities

Advisers/Broker to the Company

Juliet Thompson, Jonathan Senior

Tel: +44 207 710 7600

ENDS

 

About Ergomed

Founded in 1997, Ergomed Plc is a profitable UK-based company, providing drug development services to the pharmaceutical industry and has a growing portfolio of co-development partnerships. It operates in over 40 countries. 

Ergomed provides clinical development, trial management and pharmacovigilance services to over 60 clients ranging from top 10 pharmaceutical companies to small and mid-sized drug development companies. Ergomed successfully manages clinical development from Phase I through to late phase programmes.

Ergomed has a wide therapeutic focus, with a particular expertise in oncology, neurology and immunology and the development of orphan drugs. Ergomed believes its approach to clinical trials is differentiated from that of other providers by its innovative Study Site Management model and the use of Study Physician Teams, resulting in a close relationship between Ergomed and the physicians involved in clinical trials.

As well as providing high quality clinical development services, Ergomed is building a portfolio of co-development partnerships with pharma and biotech companies which share the risks and rewards of drug development. Ergomed leverages its expertise and services in return for carried interest in the drugs under development.  For further information, visit: http://ergomedgroup.com

 

This announcement is for information purposes only and does not constitute or form part of any offer or invitation to underwrite, sell or issue, or any solicitation of any offer to purchase or subscribe for, any ordinary shares or other securities in the capital of the Company, nor shall it (or any part of it), or the fact of its distribution, form the basis of, or be relied on in connection with or act as any inducement to enter into, any contract whatsoever relating to any ordinary shares or securities.

Oriel Securities Limited is regulated by the Financial Conduct Authority and is acting exclusively for the Company and no one else in connection with the Fundraising and Admission and will not regard any other person (whether or not a recipient of this announcement) as a client in relation to the Fundraising or Admission and will not be responsible to anyone other than the Company for providing the protections afforded to its clients or for providing advice in relation to the Fundraising, Admission or any transaction, arrangements or other matters referred to in this announcement.

The Fundraising and the distribution of this announcement and other information in connection with the Fundraising in certain jurisdictions may be restricted by law and persons into whose possession any document or other information referred to herein comes should inform themselves about and observe any such restriction. Any failure to comply with these restrictions may constitute a violation of the securities laws of any such jurisdiction.

The New Ordinary Shares have not been and will not be registered under the United States Securities Act 1933 (as amended) nor under the applicable securities laws of the United States of America or any province or territory of Canada, Australia or Japan, nor in any country or territory where to do so may contravene local securities laws or regulations and will not be made to any national, resident or citizen of the United States of America, Canada, Australia or Japan. No reliance may or should be placed by any person for any purpose whatsoever on the information contained in this announcement or on its completeness, accuracy or fairness. The information in this announcement is subject to change. Investments to which this announcement relates may expose an investor to a significant risk of losing all of the amount invested. This announcement does not constitute a recommendation concerning the Fundraising. The value of shares can decrease as well as increase. Potential investors should consult a professional advisor as to the suitability of the Fundraising for the person concerned.

Forward Looking Statements

Certain statements contained within the announcement are forward looking statements and are based on current expectations, estimates and projections about the potential returns of the Group and industry and markets in which the Group operates, the Directors' beliefs and assumptions made by the Directors. Words such as "expects", "anticipates", "should", "intends", "plans", "believes", "seeks", "estimates", "projects", "pipeline" and variations of such words and similar expressions are intended to identify such forward looking statements and expectations. These statements are not guarantees of future performance or the ability to identify and consummate investments and involve certain risks, uncertainties, outcomes of negotiations and due diligence and assumptions that are difficult to predict, qualify or quantify. Therefore, actual outcomes and results may differ materially from what is expressed in such forward looking statements or expectations. Among the factors that could cause actual results to differ materially are: the general economic climate, competition, interest rate levels, loss of key personnel, the result of legal and commercial due diligence, the availability of financing on acceptable terms and changes in the legal or regulatory environment.

These forward-looking statements speak only as of the date of this announcement. The Group expressly disclaims any obligation or undertaking to disseminate any updates or revisions to any forward-looking statements contained herein to reflect any change in the Group's expectations with regard thereto, any new information or any change in events, conditions or circumstances on which any such statements are based, unless required to do so by law or any appropriate regulatory authority.

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