DEPRENYL BUYER GOLDFARB DROPS OUT

Canada's Goldfarb Corp has dropped out of a plan to buy a minority stake in Deprenyl Research Ltd (Marketletter November 1). The other (joint) contender for a share in Deprenyl, Novopharm, is reportedly still interested.

Goldfarb's general counsel, Alonna Goldfarb, said the company had come to the conclusion that both the financial commitment and managerial commitment that would be necessary to "grow" Deprenyl would have been larger than had been envisaged. The total deal to acquire 20% at up to C$2.75 per share with warrants to acquire a further 19.3% has been put at around C$45 million ($33.8 million).

Problems apparently started when Deprenyl, whose major current product is the anti-Parkinson's disease drug Eldepryl (selegiline), showed concern that the deal would have substantially diluted the holdings of existing shareholders. For its part, Goldfarb was unhappy with the fact that with Novopharm it would be expected to put up 80% of Deprenyl's market capitalization for only 40% of the equity.The Toronto Star notes that the proceeds were to be used for Deprenyl's expansion into the over-the-counter market. However, company president Martin Barkin says "if we're not going into those lines of business we won't need the equity infusion."