MediciNova, Avigen Pair Up For Definitive Merger Agreement

MediciNova and Avigen have entered into a definitive merger agreement pursuant to which MediciNova’s wholly-owned subsidiary will merge with and into Avigen.

Reportedly, completion of the transaction will permit the combination of the companies broad neurological clinical development programs based on ibudilast (Avigen’s AV-411 and MediciNova’s MN-166).

Under the terms of the agreement, Avigen shareholders will have the right to elect to receive an amount currently estimated at approximately $1.24 per share in either cash or secured convertible notes to be issued by MediciNova. Approximately $1.19 of this consideration will be paid at the closing, and approximately $0.05 will be paid at June 30, 2010.

The company said that the transaction is expected to close in the fourth quarter of 2009 and is subject to approval of Avigen’s stockholders and approval of MediciNova’s stockholders as well as other customary closing conditions.

Yuichi Iwaki, president and CEO of MediciNova’s, said: We are excited about combining Avigen with MediciNova and believe that it presents a unique opportunity for shareholders of both companies, most notably, the ability to more fully take advantage of the opportunities that the ibudilast compound and analogs provide in a variety of indications and markets.