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Synergy Stock Plunges As Bausch Health Confirmed As Successful Bidder For Assets

(RTTNews) - Synergy Pharmaceuticals Inc.'s (SGYP) shares declined around 85 percent in the extended trading on Tuesday after the company confirmed Bausch Health Companies Inc. (BHC, BHC.TO) as the highest and best offer for its business assets.

The biopharmaceutical company focused on the development and commercialization of novel gastrointestinal or GI therapies earlier had announced an agreement with Bausch Health for its assets, including all rights to TRULANCE (plecanatide), dolcanatide and related intellectual property.

The company noted that the auction scheduled for February 26 did not proceed, as no party submitted a higher and better bid in accordance with the bidding procedures established by the U.S. Bankruptcy Court for the Southern District of New York.

Synergy currently expects the agreement with Bausch Health will be approved by the Bankruptcy Court on March 1, 2019, and that the proposed sale will be completed shortly thereafter.

Synergy on December 12, 2018, initiated voluntary proceedings under Chapter 11 of the U.S. Bankruptcy Code in the U.S. Bankruptcy Court for the Southern District of New York to facilitate a sale and address its debt obligations.

Separately, Bausch Health announced its selection as the successful bidder to acquire certain assets of Synergy for a cash purchase price of approximately $195 million and the assumption of certain assumed liabilities.

Joseph Papa, chairman and CEO, Bausch Health, said, "We are excited to acquire the assets of Synergy, which we believe will strategically enhance our Salix Pharmaceuticals business and supplement our organic growth in gastroenterology. With our team's expertise in GI and primary care, we will strengthen our already formidable portfolio of innovative irritable bowel syndrome solutions with the addition of TRULANCE. Additionally, dolcanatide, an investigational incremental peptide that has established proof of concept studies in a host of GI conditions, will be a welcome addition to our early stage pipeline."

On Nasdaq, Synergy shares settled at $0.20 on Tuesday's regular trading, down 16.3 percent. In the after hours trading, shares plunged 84.5 percent to $0.031.

Bausch Health shares gained around 0.8 percent in the extended trading on the NYSE.
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