Cyberkinetics Neurotechnology Systems to Acquire Andara Life Science

Cyberkinetics Neurotechnology Systems, Inc. has agreed to acquire, through a merger with a wholly owned subsidiary of Cyberkinetics, Andara Life Science, Inc. ("Andara"). A privately held Indiana company, Andara is engaged in the development of a portfolio of programs related to the repair and regeneration of neural tissues, which were developed at the Center for Paralysis Research at Purdue University.

Cyberkinetics expects to submit an application for approval of Andara’s lead product, the Andara Oscillating Field Stimulator (”Andara OFS Device”) in 2006 under a Humanitarian Device Exemption based on a recently completed 10-participant clinical trial for those with acute spinal cord injury. Preclinical studies that demonstrated the device’s ability to stimulate regeneration of nerve fibers in the spinal cord.

The boards of directors of both companies have unanimously approved the merger, which will close upon the filing of merger documentation in Delaware and Indiana. The wholly owned subsidiary of Cyberkinetics will acquire all of the outstanding capital stock of Andara in exchange for $3.075 million USD of unregistered shares of Cyberkinetics common stock, which are subject to contractual restrictions and $1.5 million USD of unregistered restricted stock subject to forfeiture. On the successful achievement of one of a number of specific regulatory milestones, the risk of forfeiture with respect to the restricted stock will lapse.

The Andara OFS Device potentially addresses several neural stimulation markets, including traumatic brain injury, stroke, peripheral nerve damage and spinal cord injury.

President and chief executive officer of Andara, Mark Allen Carney has joined Cyberkinetics as executive vice president and director. He will be leading the effort to commercialize the Andara OFS Device, and managing business development activities related to certain additional technologies acquired in the transaction. Dr. Richard Ben Borgens, chief scientific officer of Andara, and Mari Hulman George, professor of applied neuroscience and director of the Center for Paralysis Research at Purdue University, will become scientific advisors to Cyberkinetics.

President and chief executive officer at Cyberkinetics, Timothy R. Surgenor said, “We now have innovative, proprietary, therapeutic programs based on neural stimulation, as well as neural sensing. The Andara OFS Device has already been shown in clinical trials to offer compelling benefits in the acute treatment of spinal cord injuries and has significant market potential. With the application for designation as a Humanitarian Use Device already submitted, we look forward to bringing this important therapeutic platform forward toward market launch.”

Source: Cyberkinetics