EXHIBIT
99.1
{Access
Letterhead}
ACCESS
NEWS
Contact:
Company
Contact: Investor Relations
Stephen
B.
Thompson Donald
C. Weinberger/Alisa Steinberg (media)
Vice
President, Chief Financial
Officer
Wolfe Axelrod Weinberger Assoc. LLC
Access
Pharmaceuticals,
Inc. (212)
370-4500
(214)
905-5100
Andrew
Hellman, CEOcast, Inc. for Access Pharmaceuticals
(212)
732-4300
Access
Pharmaceuticals Announces $19.5 Million
Recapitalization
-$9.5
Million Institutional Private Placement of Convertible Preferred
Stock-
-$10
Million Principal Amount of Debt Exchanged for Convertible Preferred
Stock-
DALLAS,
TX, November 8, 2007, ACCESS PHARMACEUTICALS, INC. (OTC BB: ACCP)
announced today that it has executed arrangements for a $19.5 million
recapitalization. The Company has entered into agreements with institutional
investors to purchase an aggregate of $9.5 million in gross proceeds of the
Company’s newly issued Series A Convertible Preferred Stock. Lead investors in
the placement transaction include SCO Capital Partners and Perceptive Life
Sciences. In addition SCO Capital Partners, Oracle Partners and certain of
their
affiliates have agreed to exchange $10 million principal amount of senior debt
into Series A Convertible Preferred Stock.
“We
are
delighted to complete this placement to high-quality institutional investors,”
said Stephen R. Seiler, Access’ President and CEO. “The new capital will enable
us to further a number of key objectives including pursuing and expanding our
clinical trial program for Access’ anti-cancer compound, ProLindac, a novel,
proprietary DACH platinum which is currently in Phase 2 development. The
exchange of convertible debt for Series A Convertible Preferred Stock also
allows us to achieve what was one of our major corporate goals for 2007, which
is to simplify our capital structure and replace debt having a short-term
maturity with permanent capital.”
Pursuant
to the securities purchase agreements, the Company will, subject to the
completion of the closing, issue to the new investors Series A Convertible
Preferred Stock initially convertible into
Access
Pharmaceuticals, Inc.
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2
3,179,999
shares of the Company’s common stock. The investors will also receive warrants
to purchase an additional 1,590,000 shares of the Company’s common stock at an
exercise price of $3.50. In exchange for their outstanding $10 million principal
amount of convertible notes presently convertible into 6,257,544 shares of
common stock, the Company will, following the closing, issue to SCO Capital
Partners, Oracle Partners and certain of their affiliates, Series A Convertible
Preferred Stock initially convertible into 6,792,877 shares of common stock.
In
addition, the current note holders will receive warrants to purchase 1,669,167
shares of common stock at an exercise price of $3.50.
Closing
of the transaction is subject to the fulfillment of customary and usual closing
conditions.
Rodman
& Renshaw, LLC, a wholly owned subsidiary of Rodman & Renshaw Capital
Group, Inc. (NasdaqGM:RODM - News) acted as the exclusive
placement agent for the transaction.
_________________________________
About
ProLindac™:
ProLindac
is a novel DACH platinum prodrug which has been shown to be active in a wide
variety of solid tumors in both preclinical models and in human trials. Access
believes that ProLindac’s unique molecular design potentially could eliminate
some of the toxic side effects seen in the currently marketed DACH platinum,
Eloxatin, which has sales in excess of $2 billion.
About
Access:
Access
Pharmaceuticals, Inc. is an emerging biopharmaceutical company that develops
and
commercializes propriety products for the treatment and supportive care of
cancer patients. Access' products include ProLindac™, currently in Phase 2
clinical testing of patients with ovarian cancer and MuGard™ for the management
of patients with mucositis. The company also has other advanced drug delivery
technologies including Cobalamin™-mediated targeted delivery and oral drug
delivery. Access has announced the execution of a definitive merger agreement
to
acquire Somanta. The acquisition of Somanta has not yet closed and the closing
is subject to numerous closing conditions. For additional information on Access
Pharmaceuticals, please visit our website at www.accesspharma.com
.
This
press release contains certain statements that are forward-looking within the
meaning of Section 27a of the Securities Act of 1933, as amended, and that
involve risks and uncertainties. These statements include those relating to:
our
ability to close the recapitalization transactions, early results from our
clinical trial, Access’ plans to continue and initiate clinical trials as well
as combination trials, planned dose escalation, the absence of nephrotoxicity,
the ability to establish a higher therapeutic index for ProLindac, the value
of
its products in the market, its ability to achieve clinical and commercial
success, its ability to successfully develop marketed products and the ability
to obtain or meet the closing conditions in the merger agreement with Somanta
Pharmaceuticals, Inc. and applicable regulatory and tax requirements, and to
otherwise complete the merger in a timely manner, yet there can be no assurances
that the closing conditions will be met or waived or that the transaction will
close. These statements are subject to numerous risks, including but not limited
Access’ need to obtain additional financing in order to continue the clinical
trial and operations and to the risks
Access
Pharmaceuticals, Inc.
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3
detailed
in Access’ and Somanta’s Annual Reports on Form 10-KSB and other reports filed
by Access and Somanta with the Securities and Exchange
Commission.
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