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news.Nuvo Research has licensed the exclusive rights from Paladin Labs to develop and commercialize a novel topical pain formulation with the potential to treat inflammatory and neuropathic pain conditions. The formulation is in the pre-clinical formulation development stage and is the subject of a pending patent application.
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Nuvo will issue to Paladin 961,538 common shares having a value of $125,000 for the right to commercialize this topical pain product. As part of the transaction, Paladin may receive an additional payment of $250,000 upon achievement of a regulatory milestone and will have rights to market, distribute and sell the product in Canada, South America, Central America and South Africa. Nuvo will receive royalties on Paladin sales and will have exclusive rights to exploit the licensed formulation in all other territories, including the US.
Paladin has also invested $1 million in return for 7,692,307 Nuvo common shares and 769,230 warrants (representing 10% of the number of common shares issued) by way of a private placement. Each warrant entitles Paladin to acquire one Nuvo common share during the three year period following the closing at a price of $0.169.
The proceeds of the private placement will be used by Nuvo for general corporate purposes, including expenses relating to development of the licensed product.