EUSA Pharma to Acquire US Specialty Oncology Company Cytogen



    Acquisition of US Infrastructure Completes Build of EUSA's Transatlantic
    Commercialization Platform

    US$22.6 Million Acquisition Expands EUSA's Product Portfolio

    EUSA Raises Over US$50 Million to Fund Acquisition and Other Investments

    DOYLESTOWN, PA and OXFORD, England, March 11 /CNW/ - EUSA Pharma Inc
('EUSA'), a transatlantic specialty pharmaceutical company focused on
oncology, pain control and critical care, today announced that it has entered
into a definitive agreement to acquire all the outstanding shares of Cytogen
Corporation (NASDAQ:   CYTO) for US$22.6 million. Cytogen is a specialty
pharmaceutical company with three oncology and pain control products on the
American market, a specialist US sales force and an established commercial
infrastructure. To meet the acquisition consideration, and fund further
investments, EUSA Pharma has concurrently raised over US$50 million in an
investment round, led by TVM Capital, an international venture capital firm.
    "The acquisition of Cytogen is of great strategic importance for EUSA as
it completes the building of our transatlantic commercialization
infrastructure, as well as fitting perfectly with our focus on oncology and
pain control," said Bryan Morton, Chief Executive of EUSA Pharma. "Over the
last 18 months EUSA has built a strong European organization covering over 20
countries and marketing a portfolio of six specialty pharmaceuticals.
Cytogen's products and US infrastructure are the ideal complement to our
business, offering us the opportunity to commercialize a rapidly growing
portfolio of medicines on both sides of the Atlantic."
    Commenting on the acquisition, Rolf Stahel, Chairman of EUSA Pharma,
said, "The acquisition of Cytogen marks a step change in the growth of EUSA
and completes the foundations of a world-class specialty pharmaceutical
company. This transaction will transform our business, putting in place a
truly transatlantic growth platform, and positioning the company as the
partner of choice for future acquisitions and specialty product in-licensing."

    Strategic rationale

    The acquisition of Cytogen brings to the enlarged EUSA group an
established US commercial organization with a 40-strong specialist oncology
sales force and three marketed products.

    - Caphosol(R) is a supersaturated calcium phosphate rinse indicated for
the treatment of oral mucositis, a common and debilitating side-effect of
radiation therapy and high-dose chemotherapy, and for the treatment of
xerostomia.

    - ProstaScint(R) is a monoclonal antibody-based agent used to image the
extent and spread of prostate cancer.

    - Quadramet(R) is a radiopharmaceutical for the treatment of pain in
patients whose cancer has spread to the bones.

    The enlarged group will have broad sales and marketing capabilities, via
direct sales forces in the US and across Europe, and through distribution
partners in a number of territories including Canada, South America and Asia.
EUSA will have a portfolio of nine marketed medicines and five late-stage
development products. The acquisition of Cytogen provides EUSA with the
capabilities to commercialize a number of these medicines on both sides of the
Atlantic.
    In addition, the enlarged group's transatlantic infrastructure provides
the company with a strategic growth platform to exploit additional products
through acquisition and in-licensing. With its highly focused business model,
EUSA will have the opportunity to compete effectively with major players,
making it an attractive partner for companies seeking specialist transatlantic
commercial and late-stage development expertise.

    Transaction details

    Under the terms of the all-cash merger agreement Cytogen shareholders
will receive US$0.62 per share, representing a 35% premium on the company's
share price at the close of trading on 10 March 2008, and valuing the company
at US$22.6 million.
    The Cytogen Board has approved the cash merger agreement and resolved to
recommend that the company's shareholders adopt the agreement. Completion of
the acquisition is conditional on the approval of a majority of Cytogen's
shareholders and fulfillment of certain pre-closing conditions. Upon
completion, EUSA intends to apply to delist all Cytogen's issued shares from
the NASDAQ stock exchange.
    To meet the consideration for the acquisition, provide working capital to
integrate and refocus the Cytogen organization and undertake further
investments, EUSA Pharma has raised over US$50 million in an investment
fundraising. This investment round, which is conditional on the completion of
the Cytogen acquisition, is led by TVM Capital and supported by EUSA's
existing investors, Essex Woodlands, 3i, Goldman Sachs, Advent Venture
Partners, SV Life Sciences, NeoMed and NovaQuest.

    Financial position

    During 2007, Cytogen's revenues totaled US$20.2 million, with the company
making a net loss of US$25.7 million for the year. At the end of December 2007
the company held cash and cash equivalents totaling US$8.9 million. During
2007, Cytogen began a program to refocus its strategy, reduce costs and
promote its products more effectively by building on its expertise in the
oncology field. EUSA intends to accelerate this initiative and rapidly drive
the business to profitability, while retaining the strengths of the Cytogen
organization.

    About EUSA Pharma Inc

    EUSA Pharma is a rapidly growing transatlantic specialty pharmaceutical
company focused on in-licensing, developing and marketing late-stage oncology,
pain control and critical care products. The company currently has six
products on the market, including the antibiotic surgical implant
Collatamp(R) G, Erwinase(R) and Kidrolase(R) for the treatment of acute
lymphoblastic leukemia, and Rapydan(R), a rapid-onset anesthetic patch which
recently received Europe-wide approval. EUSA also has several products in
late-stage development, notably Collatamp(R) G topical, a gentamicin
impregnated collagen sponge for the prevention and treatment of infected skin
ulcers, and CollaRx(R) bupivacaine implant(i) for local post-surgical pain
control.
    Founded in 2006, EUSA Pharma is supported by a consortium of leading life
science capital investors, comprising TVM Capital, Essex Woodlands, 3i,
Goldman Sachs, Advent Venture Partners, SV Life Sciences, NeoMed and
NovaQuest. Since its foundation, the company has raised over US$225 million in
addition to the fund raising announced today, and completed several
significant transactions, including the acquisitions of Talisker Pharma Ltd,
the French biopharmaceutical company OPi SA and the European antibiotic and
pain control business of Innocoll Pharmaceuticals Inc. As part of its rapid
growth strategy the company has established commercial infrastructure in the
US, a pan-European presence covering over 20 countries and a wider
distribution network in a further 25 territories. EUSA Pharma plans to
continue its aggressive program of acquisitions and in-licensing within its
specialist areas of medical and geographic focus, in line with its ambitious
target to create a rapidly growing US$1 billion company by the beginning of
the next decade.

    For more information please visit http://www.eusapharma.com.

    (i) CollaRx(R) is a registered trademark of Innocoll Technologies Ltd.

    TVM Capital

    TVM Capital, founded in 1983, is one of the first venture capital firms
formed in Germany and was an early entrant into the US market in 1986. Since
inception, TVM Capital has raised more than EUR 1.3 billion in six fund
generations and has established itself as a leading international technology
and life science investment group. TVM Capital funds have made investments in
more than 235 technology and life science companies including emerging
technology sectors such as energy efficiency, renewable energy generation,
energy storage and water treatment. Over the life of the firm, TVM Capital has
developed specialized, focused teams and dedicated funds to serve high-growth
target markets. The TVM Capital investment strategy is to create global
businesses that enjoy worldwide access to science, technology, management
talent and capital, and to develop them into significant players in their
markets. More than 50 TVM Capital backed companies have gone public on
European or US stock exchanges. Today, TVM Capital is actively invested in 70
companies.

    For more information please visit: http://www.tvm-capital.com.





For further information:

For further information: Bryan Morton, Chief Executive, EUSA Pharma,
Tel: +44(0)1865-784255; Rob Budge, RJB Communications, Tel: +44(0)1865-760969,
Mobile: +44(0)7710-741241

Organization Profile

EUSA PHARMA INC.

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