Kadimastem's collaboration with Korean co falls through

Kadimastem CEO Yossi Ben-Yosef, photo: Studio-One
Kadimastem CEO Yossi Ben-Yosef, photo: Studio-One

The MOU Kadimastem signed with South Korea's Corestem in December has not matured into an agreement.

The memorandum of understanding between stem cell company Kadimastem (TASE: KDST) and Corestem of South Korea has not matured into a binding agreement. Kadimastem's share price has fallen to NIS 5.42, slightly lower than the price at which it was traded before the announcement of the memorandum of understanding last month. Kadimastem currently has a market cap of some NIS 101 million.

The collaboration agreement was to have led to an initial investment of $7 million in Kadimastem, an investment that the company badly needs, as at the end of the third quarter of 2016 it had just NIS 2.5 million cash. Since then the controlling shareholders have invested a further NIS 2.5 million in the form of a loan convertible to equity.

Corestem was to have received marketing rights in South Korea for Kadimastem's two leading products, one for treating ALS and the other for diabetes, and the two companies were to have set up a marketing joint venture. Kadimastem did not disclose the reason that the negotiations with Corestem had been broken off. Kadimastem CEO Yossi Ben-Yossef told "Globes" that Corestem had pulled out of the collaboration for reasons unconnected to Kadimastem and its products. Kadimastem announced that it would now continue with its original plans, and would shortly begin a first clinical trial for treating ALS using fetal stem cells.

In the first nine months of 2016 Kadimastem recorded revenue of NIS 884,000 from services to Merck Serono, and burnt NIS 9.8 million cash.

Published by Globes [online], Israel business news - www.globes-online.com - on January 9, 2017

© Copyright of Globes Publisher Itonut (1983) Ltd. 2017

Kadimastem CEO Yossi Ben-Yosef, photo: Studio-One
Kadimastem CEO Yossi Ben-Yosef, photo: Studio-One
Twitter Facebook Linkedin RSS Newsletters גלובס Israel Business Conference 2018