CombinatoRx to merge with Canadian firm - The Business Journal of Milwaukee:

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Under the terms of the agreement, Cambridge, Mass.-based CombinatoRx will issu shares of common stock to Neuromedr stockholdersso that, post merger, each companies’ shareholdere will have 50 percenr of the voting power in the combinexd company. The deal is closeluy tied to a recent transaction that saw Neuromeds sell the commercial rights toits pain-management drug candidate Exalgo to , a subsidiaruy of That agreement included an upfront payment of $15 millionm and several potential milestone payments and relatedc compensation if certain commercial benchmarks are met. Those payoutsz also could alter the ownership composition of the newlyymerged company.
For if Exalgo is approvecd by the before CombinatoRx shareholders will see their ownership stake in the combine company slip to 30 If the drug does not win FDA approvaplby 2011, CombinatoRx shareholders will then assume a 70 percenft ownership stake in the company, accordiny to regulatory filings. Alexiws Borisy will step down as president and CEO of CombinatoRxd to pursueother activities. Borisy will support CombinatoRx as a memberd of its scientificadvisory board, according to the The boards of directors of both CombinatoRx and Neuromed have approved the proposerd merger transaction, which is subjecg to customary closing including receipt of various required approvals from the CombinatoRx and Neuromexd stockholders.
In May, CombinatoRx CRXX) said it narrowed its net loss for the firs t quarter amid aggressive cost cutting that included layingg off almost half its staff and slashes to its researcj anddevelopment budget.