October 2016 Deal Round-Up

A monthly round-up of a selection of major Canadian deals in the life sciences and healthcare sector.

ACQUISITIONS

Date: October 13, 2016

Acquirer: Loblaw Companies Limited, through its wholly owned subsidiary, Shoppers Drug Mart Inc.

Target: QHR Corporation

Deal size: Approx. CDN$170,000,000

Description: On October 13, 2016, Loblaw Companies Limited, through its wholly-owned subsidiary, Shoppers Drug Mart Inc., completed its acquisition of all of the issued and outstanding shares of TSX-V listed QHR Corporation for CDN$3.10 in cash per share. As of close of business on September 6, 2016, there were 52,262,877 QHR shares and QHR options to purchase an aggregate of 2,684,910 QHR shares outstanding, making the total bid for the acquisition approximately CDN$170,000,000. The acquisition was completed by way of a plan of arrangement under Section 192 of the Canada Business Corporations Act. Canadian QHR Corporation's offerings include an electronic medical records platform and a variety of clinical management tools.

Source: Press Release, "Loblaw Companies Limited completes acquisition of QHR Corporation", October 13, 2016

Date: October 21, 2016

Acquirer: Sunovion Pharmaceuticals Inc. through its wholly owned subsidiary, Sunovion CNS Development Canada ULC

Target: Cynapsus Therapeutics Inc.

Deal size: Approx. US$635 million

Description: On October 21, 2016, Sunovion Pharmaceuticals Inc., through its wholly owned subsidiary, Sunovion CNS Development Canada ULC, acquired 13,520,414 shares and 1,885,452 warrants, representing all of the outstanding shares and warrants of Cynapsus Therapeutics Inc., a US-listed, Canada-based company. Share holders received US$40.50 in cash per share and warrant holders received US$40.50 in cash per warrant (less the exercise price per warrant), amounting to a total acquisition price of approximately US$635 million. The acquisition was completed by way of a plan of arrangement under the Canada Business Corporations Act.  Cynapsus is developing a sub-lingual film to treat OFF episodes associated with Parkinson's Disease. The product is currently being tested in Phase 3 clinical trials.

Source: Press Release, "Sunovion Pharmaceuticals Completes Acquisition of Cynapsus Therapeutics", October 21, 2016

FINANCINGS

Date: October 4, 2016

Agent(s): A syndicate of agents co-led by Clarus Securities Inc. and Sprott Private Wealth LP, and including Bloom Burton & Co. and KES 7 Capital Inc.

Investee: Cannabis Royalties & Holdings Corp.

Deal size: Approx. CDN$5 million

Description: On October 4, 2016, Cannabis Royalties & Holdings Corp. (CRHC) completed a brokered offering of 2,502,000 subscription receipts at a price of CDN$2.00 per subscription receipt for total gross proceeds of approximately CDN$5 million through a syndicate of agents co-led by Clarus Securities Inc. and Sprott Private Wealth LP, and including Bloom Burton & Co. and KES 7 Capital Inc. The brokered offering was completed in connected with a proposed business combination of CRHC and Bonanza Blue Corp. CRHC is building a platform of holdings via royalty agreements and equity stakes encompassing research, brands and devices covering key segments of the legal cannabis market.

Source: Press Release, "Cannabis Royalties & Holdings Completes Subscription Receipts Offering in Connection with Business Combination with Bonanza Blue", October 4, 2016

Date: October 6, 2016

Investor(s): Quark Venture Inc., through its Global Health Sciences Venture Fund

Investee: MSI Methylation Sciences Inc.

Deal size: Approx. US$30 million

Description: On October 6, 2016, Quark Venture Inc., through its Global Health Sciences Venture Fund invested US$30 million in BC-based MSI Methylation Sciences Inc. MSI is a clinical stage company developing an oral small molecule therapy for adjunctive treatment of Major Depressive Disorder.

Source: Press Release, "Vancouver-based MSI raises US$30 million investment from Quark Venture Inc. to advance treatment for patients suffering with Major Depressive Disorder", October 6, 2016

Date: October 18, 2016

Investor(s): A syndicate of U.S. and Canadian investors, including Bloom Burton & Co., through its affiliated fund the Bloom Burton Healthcare Lending Trust

Investee: Newtopia Inc.

Deal size: Approx. USD$10 million 

Description: On October 18, 2016, a syndicate of U.S. and Canadian investors, including Bloom Burton & Co, through its affiliated fund the Bloom Burton Healthcare Lending Trust, announced a USD$10 million investment in Newtopia Inc. in a Series A funding round. Newtopia is a personalized health company that uses genetic testing and behavioural science to personalized disease prevention plans for enterprise.

Source: Press Release, "Newtopia announces $10 million in Series A funding", October 18, 2016