Napo Pharmaceuticals
Crofelemer
A proprietary gastro-intestinal compound in clinical development for four distinct product indications
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ISSUANCE OF US$0.12 MILLION CONVERTIBLE NOTES
South San Francisco, California, 27 June, 2008 - Napo Pharmaceuticals, Inc., (LSE: NAPL and NAPU), announces that the Company has issued convertible notes (the "Notes") worth approximately US $0.12 million gross (US $0.12 million net) (approximately GBP 0.06 million gross (GBP 0.06 million net)) to a trade creditor in settlement of payments due. This trade creditor had previously agreed in March 2008 to defer $0.1 million of payments to 1 August 2008. The additional US$0.02 million relates to settlement of a payment due to the creditor following 1 August 2008.
The Notes are repayable on the first anniversary of their issue and bear interest at 8% per annum, payable in cash or the Company's common shares of US$0.0001 each ("Common Shares"). In most circumstances, the Notes are convertible after 90 days at the option of the holders into Common Shares, at 10.1 pence per Common Shares, being the average of the mid market closing price of the Common Shares quoted in the Official List published by the UK Listing Authority over the 10 trading days prior to the date of issue (the "Conversion Price").
The maximum number of Common Shares that may be issued under a conversion at the Conversion Price is 606,366 Common Shares (the "Conversion Shares"), representing approximately 1.1 per cent of the issued share capital of the Company.
Any issue of Conversion Shares pursuant to conversion of the Notes is subject to the approval by the Company's shareholders and such approval is anticipated to be sought at the same meeting of Shareholders to be convened in relation to the convertible notes announced on 23 June 2008, a circular convening which is expected to be published shortly. If required, application for the Conversion Shares to be admitted to listing on the Official List and to trading on the London Stock Exchange's Main Market will be made at the relevant time. The issue of the Notes is not conditional on shareholder approval.
The Company expects current funds (including these Notes) to provide the Company with funds into August 2008. The Notes, together with existing resources and other funds which the Directors expect to raise through the out-license of certain rights to crofelemer including the indications of CRO-HIV, CRO-IBS, CRO-ID and CRO-PED in the United States and other western territories; as well as certain rights to NP-500, in exchange for a licensing fee(s), will be used primarily for working capital purposes and to continue to finance the costs of the CRO-HIV Phase 3 US trial. Such licensing fees may need to be supplemented with debt or equity issuances in order for Napo to have sufficient funds to complete the CRO-HIV Phase 3 clinical trial.
For more information please contact:
Napo Pharmaceuticals, Inc.
Lisa Conte, Chief Executive Officer
+001 (650) 616-1902
Charles Thompson, Chief Financial Officer
+001 (650) 616-1902
Buchanan Communications
+ 44 (0)20 7466 5000
Tim Anderson, Mary-Jane Johnson, Catherine Breen
About Napo Pharmaceuticals, Inc.
Napo Pharmaceuticals, Inc. focuses on the development and commericalization of proprietary pharmaceuticals for the global marketplace in collaboration with local partners. Napo was founded in November 2001, and is based in California, USA with a subsidiary in Mumbai, India.
Napo's late-stage proprietary gastro-intestinal compound, crofelemer, is in various stages of clinical development for four distinct product indications, including a late-stage Phase 3 program:
The FDA has granted fast-track status to CRO-IBS and CRO-HIV.
Crofelemer, a proprietary patented first in class agent, is extracted from Croton lechleri, a medicinal plant which can be sustainably harvested from several countries in South America. Napo has exclusive worldwide rights to synthetic compounds in pre-clinical development which act by the same mechanism of action. Napo also plans to develop an early clinical stage product, NP-500, for the treatment of insulin resistant diseases of Type II diabetes and metabolic syndrome (Syndrome X; pre-diabetic syndrome) and has 4 issued patents for anti-cancer agents in pre-clinical development. Napo has a plant library of approximately 2,300 medicinal plants from tropical regions and Napo has entered two screening relationships associated with this collection. Currently, products are based on the chemical and biological diversity derived from plants with medicinal properties, but future products may be in-licensed from other sources.
For more information please visit www.napopharma.com.
This announcement contains forward-looking statements relating to Napo Pharmaceuticals and its products that involve risks and uncertainties, including statements regarding future products and developments that are not historical facts. Such statements are only predictions and the company's actual results may differ materially from those anticipated
in these forward-looking statements. These statements can be identified by the use of forward-looking terminology such as "believe," "expect," "may," "will," "should, "could," "project," "plan,'' "seek," "intend,'' or "anticipate'' or the negative thereof or comparable terminology and statements about industry trends and Napo's future performance, operations and products.