Cash-strapped Antex Biologics Inc. of Gaithersburg filed for bankruptcy protection after last-ditch negotiations to sell itself to vaccine maker BioPort Corp. unraveled, the biotechnology company said.
Antex said its shareholders and noteholders refused to sign off on its acquisition plan, which included a loan of up to $1 million from BioPort. As a result, BioPort pulled out of the proposed sale, forcing Antex to file for Chapter 11 bankruptcy protection Thursday in Maryland.
Antex said it still plans to sell its assets to BioPort, a privately owned Lansing, Mich., biotechnology company, after filing a reorganization plan "in the near future." The sale would be subject to bankruptcy court approval and an auction process.
Despite the setback, BioPort is "committed to acquiring Antex and its assets," company spokeswoman Kim Brennen Root said. BioPort, founded in 1998, supplies the Defense Department with the only federally approved anthrax vaccine. Antex executives did not return phone calls yesterday.
BioPort said March 17 that it had agreed to acquire Antex's assets -- and to retain its 38 employees -- for $3 million in cash or $3.6 million in cash and notes while funding operations until the deal closed. So far, BioPort has given Antex $300,000, the company said.
But Antex, founded in 1991, said it could not obtain two or more of the agreements required under the liquidation plan. Preferred stockholders refused to exchange their shares for future royalties on two experimental products, and noteholders declined to settle their claims at significant discounts. It is unclear whether creditors agreed to the terms.
As a result, Antex said in a statement, "the company had no alternative but to file for bankruptcy protection."
Antex said it is seeking debtor-in-possession financing to fund operations until a reorganization plan is approved.
The company, which has six drugs in human tests but none on the market, has struggled to lure investment. As of Sept. 30, Antex had $1.2 million in cash but needed $2 million to fund operations through the remainder of 2002, according to filings with the Securities and Exchange Commission.
Under bankruptcy rules, the proceeds of any sale would first be distributed to Antex creditors, with any remaining assets given to shareholders.