Pharmaceutical company AlphaRx, Inc. announced that its Canadian subsidiary AlphaRx Canada Limited and a Canadian TSX-listed company Pacific Orient Capital, Inc. signed a non-binding letter of intent under which AlphaRx Canada Limited and Pacific Orient will combine in a stock transaction. The combined company will be named Pacific Orient BioPharma Group. It is planned to be an innovative high tech enterprise engaging in branded generic drug development, market promotion and distribution in China and other markets.
Following completion of the transaction, Pacific Orient BioPharma Group will have a total of 10,000,000 common shares outstanding, 55% of which will be owned by AlphaRx International Holdings Limited, a corporation incorporated under the laws of the British Virgin Islands and 80% owned by AlphaRx Inc.
Under the terms of the letter of intent, Pacific Orient will issue 5,500,000 of its common shares at a deemed price of C$0.60 per share in exchange for all the issued and outstanding shares in the capital of AlphaRx Canada Limited and the marketing rights of Indaflex for Asia and Mexico. In conjunction with the transaction, Pacific Orient will conduct private placement to raise a maximum of C$1,500,000 by issuance of common shares at C$0.60 per share.
The transaction is anticipated to be completed by the third quarter of 2010. Common shares of the combined company will be listed on the TSX Venture Exchange.
