Thursday, 17 October 2013

Vitro Biopharma announces plans to merge with Neuromics

Vitro Diagnostics, Inc. announced yesterday the signing of a non-binding letter of intent to acquire and merge with Neuromics, Inc, a privately held life-science firm located in Minneapolis. The Merger would be structured as a reverse triangular merger, with Neuromics becoming a wholly-owned subsidiary of Vitro Biopharma. 

Completion of the proposed merger would reorganize Vitro Biopharma. to include significant expansion in its core product offerings, an improved balance sheet and a novel business model to accelerate growth. Accelerated revenue growth is envisioned through diversified sources including well-established sales to research & clinical development markets, unique stem cell-based assays for use in drug discovery, development and toxicology together with competitive stem cell-based therapies targeting emerging markets in regenerative medicine. 

The proposed strategic selling approach includes biopharmaceutical firms, large distributors and contract research organizations that would augment the growing and established incremental sales to global research laboratories.
Completion of the Merger is subject to several material conditions, including, without limitation, the execution of a definitive agreement and plan of reorganization ("Merger Agreement"), completion of audited financial statements of Neuromics, requisite corporate and third party approvals, and other conditions customary in transactions of this nature. There can be no assurance as to when the Merger can be completed.

As currently contemplated, and based upon the current financial conditions of both parties to the Merger, the consideration for the Merger would consist of Vitro issuing 4.0 million shares of common stock and paying an additional $250,000 on terms yet to be determined. The Letter of Intent also contemplates the conversion of accrued debt to Vitro Biopharma's president into 1.0 million shares of common stock and other balance sheet restructuring.

The Board of Directors would consist of Jim Musick & Pete Shuster, the present CEOs of Vitro Biopharma and Neuromics, Inc., respectively, in addition to a third board member to be determined. Mr. Shuster has a broad background in sales & marketing with 28 years experience including computer hardware/software sales and the founding and management of Neuromics from its beginning in 2003 to the present. Neuromics, Inc., is a privately held business focused on sales of numerous (>2500) specialty life science products. Neuromics, Inc. sales have grown over 5.5-fold since inception in 2003. Mr. Shuster has extensive prior experience in managing sales of computer software and related products for companies including Caterpillar, Baxter Healthcare and Harley-Davidson. Jim Musick received his Ph.D. degree from Northwestern University in Evanston, IL and served various academic positions at the University of Utah prior to joining Vitro Diagnostics, Inc. in 1988. He has developed numerous commercial products including a line of diagnostic products that were sold to Aspen Biopharma, Inc. in 2000 and the present line of stem cell-based products manufactured by Vitro Biopharma. Pete Shuster is proposed to serve as CEO, while Jim Musick would be appointed Chairman of the Board and CSO.

 "I am extremely pleased at the prospect of a merger with Neuromics, Inc. There are substantial synergies between us to leverage our respective earnings potential as a merged entity. Not only does the merger with Neuromics leverage our early market position within stem cell products to a substantial presence in research and clinical development markets, we also gain enhanced access to markets for cell-based assays used in drug discovery, development and toxicology studies together with emerging markets in stem cell-based regenerative medicine. Pete Shuster is a highly regarded sales executive who has driven strong growth of Neuromics, Inc, since its inception and will lead our efforts to gain strategic sales in the substantially larger markets of drug discovery and regenerative medicine. Vitro Biopharma's product development and manufacturing capabilities can now be extended beyond incremental sales in research markets to more lucrative and sustainable revenue growth in drug discovery and regenerative medicine. In this transaction, we are endeavoring to maintain a suitable capital structure to support subsequent growth as well." said Dr. Jim Musick, Vitro's CEO.

"This merger positions us to better serve the stem cell based drug discovery and regenerative medicine markets. We have high content, physiologically relevant cell based assays in our product pipeline that are designed specifically for musculo-skeletal disease, wound healing basic and drug discovery researchers. These were selected based on careful market studies conducted as a part of our merger process." said Pete Shuster.

These assays will enable better selection of targets and cells as therapeutic candidates. These, coupled with our media, growth factors, markers and transfection/apoptosis kits, should also catalyze growth in our incremental, web based businesses. As assay data is generated, we communicate the results with our large database of researchers (24,000+) and these communications help drive new and grow existing incremental business.

Finally, Neuromics continues to build a strong social networking presence (for example 11,600+ fans on Facebook). We plan on leveraging this network to facilitate achievement of specific business goals including marketing and sales of products & services, establishment of collaborations and funding.

The goal is to maximize shareholder value for our existing and new shareholders."

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