To support the development of Pharmanest’s leading drug candidate SHACT
Sweden's Recipharm Venture Fund has with Östersjöstiftelsen and Praktikerinvest made an investment of SEK28m (approximately £2m; US$3.3m) in Pharmanest, a Stockholm-based pharmaceutical company developing products for local pain relief in obstetrics and gynaecology. Recipharm's share of the investment is SEK8m.
At the same time, Karolinska Development of Sweden and its co-investor KCIF have agreed to sell their shares in Pharmanest to the three investors in exchange for an earn out arrangement on future revenues. After completion of the transaction Recipharm will hold approximately 25% of the shares of Pharmanest.
Jim Van heusden, CEO of Karolinska Development, said: 'We are continuously evaluating creative options for all our portfolio companies to retain and realise as much value as possible. The divestment of our holding in Pharmanest to a new investor consortium is a clear example of this strategy. The consortium will provide the necessary funding to bring Pharmanest to the next value inflection point. Following the deal, Karolinska Development will provide no further financing to the company, but retains an economic interest in Pharmanest through an earn-out agreement, which has the potential to capture significant future value.'
We are convinced that Pharmanest with its product SHACT will be able to help a huge amount of women with proper pain relief where there is no good alternative today
Since 2011 Recipharm has supported Pharmanest in its development of SHACT, a topical pharmaceutical product for pain relief in conjunction with insertion of IUDs (Intra Uterine Devices). The investment will provide Pharmanest will sufficient funding to move towards its next important milestone – the submission of an application for regulatory approval in Europe for its first product candidate. Recipharm will receive pre-commercial revenues by providing Pharmanest with technical transfer and scale-up services for future commercial manufacturing in its Karlskoga facility in Sweden.
Recipharm's EVP Development & Technology Carl-Johan Spak said: 'We are convinced that Pharmanest with its product SHACT will be able to help a huge amount of women with proper pain relief where there is no good alternative today. We do believe that our technical capabilities will also be very helpful in the further development of the product and we are looking forward to manufacturing the product in commercial volumes upon regulatory approval.'
Pharmanest CEO Gunilla Lundmark added: 'The capital raised will enable us together with Recipharm to prepare for the commercialisation of SHACT. Our clinical trials indicate that SHACT has the potential to become the first safe and effective pain relief product for millions of women who use IUD.'