Amarantus Provides 2019
Roadmap
New York, NY -- January
7, 2019 --
InvestorsHub NewsWire -- Amarantus Bioscience Holdings,
Inc. (OTC
Pink: AMBS) (the "Company," or AMBS), a
US-based, JLABS-alumnus biotechnology
holding company developing first-in-class orphan neurologic,
regenerative medicine and ophthalmic therapies and diagnostics
through its
subsidiaries, today provided an update on its turnaround
plan as
senior management prepares to attend key events surrounding the JP
Morgan Healthcare Conference in San Francisco.
Progress on the AMBS Recapitalization and
Distribution Plan
Our
recapitalization plan to maximize the Company's
portfolio value is to minimize the burn rate such that maintaining
baseline operations, completing critical strategic transactions,
retiring priority obligations and the distribution of holdings to shareholders can
all be preserved. To this end, we have been working on executing
partnerships and asset sales, while simultaneously negotiating down
existing obligations.
In March 2018, the
Company announced the participation of 96%+ of its legacy
convertible securities (LCS) holders in the Tender
Exchange,
which significantly reduced balances owed, removed variable-rate
pricing provisions, provided a 9-month moratorium on conversions,
and provided a path to releasing all outstanding
liens,
while retiring the LCS
in up to 4 equal
tranches. There are currently
approximately $16M in LCS outstanding, which
the Company has the option to redeem in cash or
equitize, upon certain conditions. In
December 2018, the LCS holders extended their first redemption, approximately
$4M,
to April
2019 allowing the Company to complete the
sale of the Company's Elto Pharma subsidiary to
Coeptis
Pharmaceuticals,
Inc. ("Coeptis"). The value of the
total
consideration ultimately expected to be received by
Amarantus
from Coeptis upon this sale
is greater
than all
of the
Company's outstanding liabilities combined.
In June 2018, the
Company retained an attorney who specializes in
negotiating accounts payable (AP) to bring the Company's $10M+
in outstanding AP down substantially, as this is a requirement to
be able to equitize the LCS. Our strategy here is two-fold. First,
we will have the Company's subsidiaries, who need to be engaged in
working with certain of these AP vendors moving forward, to be
responsible for directly paying down those relevant
liabilities. Second, Amarantus intends to pay off a negotiated
remaining AP amount via a capital raise or sale of assets. We have
made substantial progress towards achieving the AP LCS equitization
requirements, and expect to have further details
on this LCS-related milestone later in the first quarter of
2019.
In November 2018,
the Company confidentially filed a Regulation A+ tier 1
offering
(the "Reg
A") with the
SEC to raise up to $20,000,000 in common equity at a
to-be-determined fixed price of up to
$1 per share. The Company received comments on the Reg A
filing
in
mid-December
from the
SEC, and expects to respond to those
comments shortly. The Company intends to use the proceeds from the
Reg A to retire the LCS
and the
AP, and
to provide enough working capital
to extend
our runway so that we can
prudently
monetize
the value of
our
subsidiary holdings as those entities achieve
critical milestones, without negatively impacting
their ability to transact.
In
December 2018, the
Company entered into
a term sheet
to exchange
certain outstanding securities held by entites
owned by Mr. Heng Fai Chan. As part of the agreement, the
Company is redeeming the Series F convertible preferred stock and
the significant voting rights associated
therewith,
in exchange for equity in Amarantus, as well as equity
in
subsidiaries Elto Pharma, Cutanogen Corporation
and Breakthrough Diagnostics. The completion of this
transaction, expected in the first quarter of 2019,
positions the Company's management
and board of directors to be able to deliver on the recapitalization plan
with a view towards maximizing common shareholder equity
value.
Management Update
Now that
significant progress has been made towards the recapitalization,
the Company believes that it is appropriate to explore
retaining
new
executive
leadership to complete the
recapitalization and distribution
plan.
The
current
management and board of directors
are
very supportive of
a potential modification in the organizational
structure, and have initiated a search to evaluate
senior leadership candidates. Further updates will be provided later
in the first quarter of 2019.
"I
am
hopeful that we can identify and retain strong, experienced executive leadership
in the near future
such that I can take on a lesser day-to-day role with the parent
Company, and focus on representing Amarantus' interests at the
subsidiary levels, as well as explore new opportunities," said
Gerald E. Commissiong, President & CEO of Amarantus, and
interim-CEO of Elto Pharma, Breakthrough
Diagnostics, Cutanogen Corporation and MANF Therapeutics. "The past
11 years since founding Amarantus have been very
exciting.
However, especially over the past 3 years, an outsized burden has been placed
on my
family. I will be most effective
serving Amarantus by being transaction-focused, and ultimately
leaving the majority of the day-to-day Amarantus operations to a new
leader tasked with executing the
monetization and capital distribution
plan."
Subsidiary transaction updates
Elto Pharma
In December 2018,
Amarantus entered into definitive agreements with
Coeptis
Pharmaceuticals
("Coeptis") to sell Elto Pharma for 7.5 million
shares of Coeptis, with an additional 7.5
million shares being delivered to Elto Pharma shareholders upon the
completion of certain milestones. Prior to the acquisition
of Elto Pharma, Coeptis has 15 million shares
outstanding. Elto Pharma is a joint venture of
which Amarantus owns approximately 50%. Elto Pharma's single asset,
eltoprazine, received an independent third-party valuation of $316M
for its Parkinson's disease levodopa-induced dyskinesia
indication (PD-LID) in 2018. Given the nature of our
recapitalization, we believe that Amarantus shareholders will benefit the
most by allowing certain milestones to be achieved for
eltoprazine's full value to be realized
by Coeptis. Dual benefits to
Amarantus shareholders should accrue
from its' participation as a
shareholder in the eltoprazine opportunity, as well as in
Coeptis' entire product
pipeline. Coeptis recently completed a
transaction to gain rights to an FDA-approved drug
it expects to launch later in 2019, thereby potentially
providing cash flow to support eltoprazine's further
development,
as well as possibly mitigating Amarantus-owned
equity
dilution in Coeptis down the
road.
Breakthrough Diagnostics
In December 2018, Amarantus
announced a Joint Venture agreement with Todos Medical
(OTC:TOMDF) to develop the Alzheimer's
blood diagnostic 'LymPro Test 2.0'. The Joint Venture is
called Breakthrough Diagnostics, Inc. ("Breakthrough"). Under the
terms of the agreement, Amarantus will
receive 19.99% of equity in Todos, and Todos will receive 19.99% of
the equity in Breakthrough, with Todos also providing initially
$500,000 to fund certain license and development costs, as well as
the retention of key management to drive the program
forward. Todos has an option to acquire
the remaining 80.01% of Breakthrough upon the achievement of
certain milestones, in exchange for a total of 50% of Todos shares
(inclusive of shares issued to Amarantus via the Joint
Venture). Todos owns rights to potentially revolutionary
technology in the early detection of cancer
based on proprietary blood
immune
markers, with
tests for breast cancer and colorectal cancer having
already received regulatory authorization in
Europe. We expect the Joint Venture
transaction to be
completed in the first quarter of
2019.
Cutanogen
Corporation and MANF Therapeutics
The Company maintains
100% ownership over its biologics subsidiaries
Cutanogen Corporation, which is developing the pivotal-stage asset
Engineered Skin Substitute (ESS), as well as MANF Therapeutics,
developing the preclinical-stage
asset mesencephalic astrocyte-derived neurotrophic
factor (MANF). Amarantus is continuing to
evaluate the best path forward for each of these subsidiaries
within the context of the recapitalization plan, as well as
the other recently
announced transactions for Elto Pharma and Breakthrough
Diagnostics. We intend to make determinations and
begin executing on Cutanogen and MANF
plans in the first
half of 2019.
Summary
We expect 2019
to be the year
where the focus returns to the development of Amarantus' rich
pipeline that has the potential to transform the standard of care
across a range of debilitating human diseases. With key assets in
Parkinson's disease, Alzheimer's disease, ADHD, autologous skin
replacement, and blindness, we believe the
fulfillment of the
Amarantus pipeline could improve the lives of millions
of patients and their families worldwide, while potentially generating
substantial revenue to the benefit of shareholders.
While the harsh realities of
the microcap financing environment have stalled our pipeline's
development timelines over the last 3.5 years, we have managed to
retain and further develop our extensive patent portfolio, and have identified potential
solutions to our financial situation. We have also been fortunate
to retain critical, dedicated senior management to shepherd
the assets through this challenging period. We begin 2019 expecting
that this year will hold significant
inflection
milestones for the Company
and its
stakeholders.
This press release
does not constitute an offer to sell or a solicitation of an offer
to buy any securities, nor will there be any offer, solicitation or
sale of securities, in any state or jurisdiction in which such
offer, solicitation or sale would be unlawful prior to registration
or qualification under the securities laws of any state or
jurisdiction.
About Amarantus Bioscience Holdings, Inc.
Amarantus
Bioscience Holdings (AMBS)
is a JLABS alumnus biotechnology company developing treatments and
diagnostics for diseases in the areas of
neurology,
regenerative medicine and orphan diseases through its subsidiaries.
AMBS' wholly-owned subsidiary Elto Pharma,
Inc. has
development rights to eltoprazine, a Phase 2b-ready small molecule
indicated for Parkinson's disease levodopa-induced dyskinesia,
Alzheimer's aggression and adult attention deficit hyperactivity
disorder, commonly known as ADHD. AMBS acquired the rights to the
Engineered Skin Substitute program, a regenerative medicine-based
approach for treating severe burns with full-thickness autologous
skin grown in tissue culture that is being pursued by AMBS'
wholly-owned subsidiary Cutanogen
Corporation.
AMBS' wholly-owned subsidiary MANF Therapeutics, Inc. owns key
intellectual property rights and licenses from a number of
prominent universities related to the development of the
therapeutic protein known as mesencephalic astrocyte-derived
neurotrophic factor ("MANF"). MANF Therapeutics,
Inc. is
developing MANF-based products as treatments for brain and
ophthalmic disorders and Parkinson's
dsiease. MANF was discovered by the
Company's Chief Scientific Officer John Commissiong, PhD. Dr.
Commissiong discovered MANF from AMBS' proprietary discovery engine
PhenoGuard. The Company also
owns
certain
rights to
the
Alzheimer's blood
diagnostic LymPro Test , as well as MSPrecise and NuroPro.
For further information please
visit www.Amarantus.com, or connect with the Amarantus
on Facebook,
LinkedIn, Twitter
and
Google+.
Amarantus Investor and Media
Contact:
Gerald
Commissiong
Office:
650-862-5391
Email:
gerald@amarantus.com
Source: Amarantus
Bioscience Holdings, Inc.
