NOT FOR PUBLICATION OR DISTRIBUTION IN THE UNITED STATES OF AMERICA
MagForce Expands into the U.S. Market
Successful 1st closing of a growth financing round for Magforce USA, Inc. under the lead of Mithril Capital Management
Berlin, Germany, July 22, 2014 - MagForce AG (Frankfurt, Entry Standard, XETRA: MF6, ISIN: DE000A0HGQF5), a leading medical device company in the field of nanomedicine focused on oncology, today announced that it has successfully established MagForce USA, Inc., together with the grant of a license for the development and commercialization of NanoTherm(TM) Therapy especially for the treatment of brain and prostate cancers. The subsidiary MagForce USA, Inc. will be responsible for developing the North American market (US, Mexico and Canada) for MagForce's technology and products. In the U.S. alone, over USD 10 billion are spent yearly treating prostate cancer.
MagForce aims at developing its technology to offer a new focal treatment for Intermediate Stage Prostate Cancer with precise ablation of the cancer lesion while sparing normal tissue. Based on European experience for brain and early prostate cancer trials, the side effects should be minimal. As previously announced, MagForce USA, Inc. has had a positive pre-submission meeting with the FDA.
In order to fund MagForce USA, Inc.'s development plans and to add further value to the enterprise in the form of strategic US shareholders, MagForce AG is allowing a limited number of selected accredited investors, including the management, to acquire a minority stake in MagForce USA, Inc.
MagForce USA, Inc. has already issued in a first closing 1,500,000 common shares at USD 10.00 per share, for aggregate gross proceeds of USD 15 million, at a pre-money valuation of USD 50 million. Furthermore, strategic investors subscribed warrants to purchase an additional 1,500,000 shares at the same valuation. Selected prospective investors who have already received the Company's Private Placement Memorandum are allowed to subscribe additional minority shares until end of July 2014 (final closing).
The growth financing round was led by Mithril Capital Management, a growth fund for transformative and durable technology companies founded by Ajay Royan and Peter Thiel.
Ben J. Lipps, Chairman and CEO of MagForce AG, commented: "I am very pleased with the development of MagForce - both in Europe and in the U.S. With our EU-wide regulatory approval, we plan to initiate commercial treatments for brain cancer late this year in Germany. The U.S., in the long term, has the largest market potential for prostate cancer treatment. Given these very positive developments over the last 10 months, I am confident we will achieve, if not exceed, our future financial targets for both Europe and North America. In Mithril, we have found the right collaborator to support our expansion plans. Ajay Royan and Peter Thiel have proven themselves numerous times to be valuable partners in helping companies unlock long-term growth."
Ajay Royan, co-founder and managing general partner of Mithril, said: "Conventional treatments for prostate cancer have significant side effects and other limitations, while patients with glioblastoma currently have few good options at all. That's why MagForce's innovative approach to solid tumors is very promising and potientially important."
Read more here:
DGAP-News: MagForce AG: MagForce Expands into the U.S. Market