Chiron Completes Acquisition of Viagene to Expand Its Activities in Gene Therapy

Page  [unnumbered] 1U/DZ/95 13:56:4? OCT. 2, 1995 Page 882 (BW)(CHIRON)(CHIR) Chiron completes acquisition of Viagene to expand its activities in gene therapy Business Editors/Medical Writers EMERYVILLE, Calif.--(BUSINESS WIRE)--Oct. 2, 1995--Chiron Corp. (NASDAQ:CHIR) announced today that it has completed the acquisition of Viagene Inc., of San Diego, to expand its research, development and manufacturing capabilities in gene therapy. Chiron's gene therapy research programs and manufacturing will be centered in San Diego under the name Chiron Viagene, which will be a part of the Chiron Technologies business unit. To focus resources on research and development, Chiron also announced a reduction of approximately 20 percent of the approximately 160 positions at Chiron Viagene, primarily in general and administrative functions, but including employees in other areas. To complete the acquisition, Chiron issued approximately 915,000 new shares of common stock, and paid approximately $36 million in cash, to acquire all outstanding shares of Viagene which it did not previously own. Chiron will expense in its third quarter ended Sept. 30, 1995, a substantial portion of the approximately $130 million of proceeds paid upon closing as the write-off of in-process technology. Based on preliminary results and terms of the merger agreement, Viagene shareholders who elected to receive all stock or who made no election will receive stock for approximately 61 percent of their holdings and cash for the remainder. Chiron's combined gene therapy research and development efforts will focus on indications in infectious disease, cancer, vaccines, cardiovascular disease and thrombosis, and may include additional indications currently under consideration. Chiron Viagene collaborations are expected to continue with Green Cross of Japan in HIV infection, and with Bayer AG of Germany in Factor VIII. Steven J. Mento, Ph.D., formerly vice president of research and development at Viagene, will head the Chiron Viagene effort as president of Chiron Viagene and vice president of Chiron Technologies. "Gene therapy is an important enabling technology that if successful will yield innovative therapeutic products across a broad spectrum of disease indications," said Lewis T. Williams, M.D., Ph.D., president of Chiron Technologies. "We foresee that gene therapy strategies will generate products that may replace current therapies, address unmet medical needs or which, when combined with existing therapeutics or vaccines, improve both efficacy and safety." "The combination of Chiron and Viagene consolidates our gene therapy program, enhances our proprietary position in the field, provides opportunities to leverage capabilities and economize efforts by focusing resources on research and clinical trials, and creates a magnet for attracting therapeutic products for delivery through our systems," Williams continued. "We will continue the programs with Green Cross and Bayer and will aggressively seek additional partners to participate in the development and commercialization of gene therapy technology. The combination of Chiron Viagene integrated with collaborations with Progenitor and 111111 I 11111111 1111 111111111 ii 5571095.0511.039