In a letter sent last week, the Nasdaq listing panel said that NexMed could continue to be listed on the exchange provided that, by March 31 next year, it regains the applicable minimum requirements for listing.
When the Bio-Quant deal was confirmed in November NexMed CFO Mark Westgate described it as an integral part of the compliance plan presented to Nasdaq listing authorities, which is a argument clearly vindicated by today’s ruling.
In wider terms, the San Diego-headquartered contract research organisation (CRO) gives NexMed an additional revenue stream that is separate from its core focus on its NexACT delivery technology.
Bio-Quant CEO Bassam Damaj, who replaces current NexMed chief Vivian Liu, said the combined firm will offer "a broader array of products and services,” adding that. “I look forward to working closely with Vivian on our integration efforts, as well as on business development and licensing activities.”
The Bio-Quant deal will also see NexMed relocate from its base in New Jersey to San Diego and lease its 31,800sqft manufacturing facility in East Windsor to an, as yet unnamed company, in a move that Westgate said will provide additional benefits for the firm.
“In light of our announcement earlier this week regarding the closing of the Bio-Quant acquisition, the timing is ideal, as we move our headquarters from New Jersey to San Diego.
“Additionally, the monthly rental payment will more than cover the existing debt service on our mortgage, thus making this a cash positive transaction. Further, the initial purchase option price which we have negotiated, of $4.4 million, is approximately $1.4 million above the existing debt on our building.”