The financing is in the form of a C$200,000 participative non-guaranteed loan from the Centre Québécois de Valorisation des Biotechnologies (CQVB) and convertible debentures totalling $150,000 from private investors.
It is understood to have been facilitated by agreements in principle in four markets – France, US, Canada and Taiwan. The French deal is the first of these to come to fruition, although Advitech is aiming for the others to be finalised by the end of this year.
Advitech president and CEO Renaud Beauchesne said the agreement with Cothera is important “as it will generate sales in a major European market as early as the last quarter of 2006."
The in principle agreement gave the Advitech and Cothera until the end of this month to finalise the deal, which provides for a minimum sales requirement for the orally administered product derived from sweet whey for 2006.
Advitech vice president and CFO Michel Lamontagne told NutraIngredients-USA.com in December that France is a particularly interesting market as more than two percent of the population suffers from psoriasis.
Cothera's model for France involves educating physicians about Dermylex and selling the tablets directly to consumers. In the US a different model is foreseen, with the partner distributing to dermatology clinics.
Advitech has said that Dermylex could complement existing drug therapies.
“Cotherapies in conjunction with pharmaceutical products are steadily increasing in number and this will be our marketing strategy for Dermylex here in France,” said Cothera CEO Dominique Bourgeade.
Throughout research and development, Dermylex has been known as XP-828L. Advitech acquired the rights to develop the nutraceutical though an agreement with French firm Pierre Jouan Biotechnologie in 2003. It originally hoped to roll out the product by the end of 2004, but decided to delay whilst it carried out a program of placebo-controlled clinical trials, the results of which are expected to give the product weight with dermatologists, as well as just with natural products suppliers. Its patience paid off in July when the results of a 112-day phase II, multi-center, placebo-controlled, double-blind study involving 84 patients were announced, confirming its safety and efficacy for sufferers of mild to moderate psoriasis. In North America, more than 6 million adults suffer from psoriasis, an immune system disorder. Until now those with mild to medium forms of the condition have had to resort to topical therapies or aggressive drug treatments with significant side effects.
Moreover the company believes it could benefit sufferers of other immune-related conditions. Positive results of a pre-clinical study into the nutraceutical's use for inflammatory bowel diseases like Crohn's disease and autoimmune colitis, were announced in October.
The Advitech-Cothera agreement is exclusive until March 31, 2007, and is renewable for an additional two-year period. The three other potential distribution partners are US PhotoMedex, Canadian Jamieson Laboratories and Taiwanese Enbio-Life Biotechnology & Medical Co.
Advitech, founded in 1997 in Quebec, specializes in the development of clinically tested bioactive ingredients for chronic immune-mediated inflammatory diseases.
