Salix, Cosmo Technologies agree to terminate merger agreement

If the merger deal was successful, Salix would have been combined with, and become a wholly-owned subsidiary of, Cosmo Technologies, a subsidiary of Cosmo.

As part of the termination agreement, which is effective immediately, Salix will make a $25m payment to Cosmo.

Salix president and CEO Carolyn Logan said when the company announced the agreement to merge with Cosmo Technologies in July it believed the combination would generate significant value for its stockholders through the addition of key products to its development pipeline and a more efficient corporate structure that would enhance our profitability.

"Since then, however, the changed political environment has created more uncertainty regarding the potential benefits we expected to achieve," Logan said.

"As a result, Salix and Cosmo have mutually agreed to terminate the proposed transaction. We look forward to a continuation of our long-standing relationship with Cosmo."

According to Cosmo, the termination has no effect on value creation and the development path of the pipeline continued.

Currently, Cosmo is focusing on securing approval of SIC-8000 and filing Rifamycin SV and Methylene Blue NDA in the next months.