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news.Welichem Biotech has entered into a termination agreement with Shenzhen Celestial Pharmaceuticals (Celestial) and Beijing Wenfeng Tianji Pharmaceuticals (BWTP) to terminate the asset purchase agreement dated March 26, 2013 among the parties, pursuant to which the Company agreed to purchase the exclusive development and commercialization rights to the novel anti-inflammatory agent, WBI-1001, in China , Taiwan , Macao and Hong Kong.
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Welichem, Celestial and BWTP have been trying to negotiate with the relevant Chinese authorities since 2012 to obtain approval of the China APA as required for the transfer the Rights, however, negotiations have been unsuccessful in this regard.
The Board of Directors of the Company determined that it would be in the best interests of the Company to terminate the China APA in light of the fact that it is unlikely that the China APA could ever be implemented.
The Termination Agreement provides that Celestial and BWTP will return the $10 million payment made by Welichem pursuant to the China APA, less an amount representing costs of the parties in seeking regulatory approval of the China APA plus the amount of any taxes required to be deducted.
On July 21, 2014 , LJ Resources (LJ) announced that it intends to exercise its rights under the compulsory acquisition provisions in Section 300 of the Business Corporations Act ( British Columbia ) to acquire all of the outstanding common shares of Welichem (the "Shares") that it does not currently own and that it has now sent a notice of compulsory acquisition to all remaining holders of Shares in connection therewith.
LJ also announced that it intends to take the necessary steps to have Welichem cease to be a reporting issuer under applicable Canadian securities laws following completion of the compulsory acquisition.