(RTTNews) -  Pharmaceutical and medical technology firm NexMed, Inc. (NEXM: News ) Monday said it has signed a deal to acquire privately held Bio-Quant, Inc., a specialty contract research organization. The transaction is expected to be closed before the end of the year. NexMed shares are currently trading up more than 11% on the Nasdaq.

Upon closing of the transaction, San Diego, California-based Bio-Quant will become a wholly-owned subsidiary of NexMed.

The agreement provides for NexMed's issuance of 4 million unregistered shares of its common stock to shareholders of Bio-Quant and a promissory note in the amount of around $12.1 million due on December 31, 2010.

East Windsor, New Jersey-based NexMed said it can elect to pay all or any portion of the note by issuing its common shares, dependent upon NexMed shareholder approval. NexMed added that certain key shareholders of Bio-Quant have agreed to vote in favor of the transaction.

Bio-Quant's co-founder, chief executive officer and chief scientific officer Bassam Damaj will become CEO of NexMed, replacing Vivian Liu, who will be taking up the role of executive vice president. Liu will continue to be responsible for leading the business development and licensing efforts for NexMed's clinical programs, NexMed stated.
Mark Westgate will remain as chief financial officer of NexMed. NexMed said the board will be composed of three Bio-Quant nominees and four NexMed nominees, and Liu is anticipated to be named as the board's chairman.

Commenting on the acquisition, Westgate stated that the purchase of Bio-Quant was an integral part of NexMed's compliance plan presented to Nasdaq Listing Qualification Panel on November 12, 2009.

NEXM is currently trading on the Nasdaq at $0.19 per share up $0.02 or 11.18% on a volume of 2.70 million shares. In the past 52-week period, the shares have been trading in a range of $0.05 to $0.54.

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by RTT Staff Writer

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