BioMimetic Therapeutics and the Memphis-based company that plans to pay up to $380 million for the developer of regenerative therapies have signed an agreement to settle shareholders' litigation over their plans.
BioMimetic and Wright Medical on Tuesday signed a memorandum of understanding to settle the shareholders' claims. The agreement — signed "solely to avoid the costs, risks and uncertainties inherent in litigation" — still needs court approval to become effective. In a filing with the Securities and Exchange Commission, the companies have outlined the terms of the agreement.
As part of the MOU, BioMimetic also has agreed to provide more details about the process that led to its November announcement to sell to Wright. Among the new information newly made public is the fact that President and CEO Sam Lynch had looked to leave BioMimetic once the sale to Wright closed. After Wright's execs and advisors insisted he stay, Lynch agreed to remain at BioMimetic until the company's Augment bone graft treatment wins FDA approval.
Also in the filing:
• BioMimetic execs told Wright they had assigned a 90 percent probability of FDA approval for Augment Bone Graft and Augment Injectable Bone Graft as well as a 60 percent probability of receiving approval for Augment Chronic Tendinopathy.
• A stand-alone BioMimetic was forecast to produce its first positive cash flow from operations in 2016.
Shares of BioMimetic (Ticker: BMTI) were changing hands Tuesday afternoon at $8.80. They have climbed more than 20 percent since the Wright sale was announced almost three months ago.