Canadian firm Pacgen Biopharmaceuticals Corporation and Taiwan-based Medigen Biotechnology Corp. have mutually agreed to terminate their letter of intent for a business combination of the two companies.

In accordance with the letter of intent signed in October 2008, the closing of the proposed business combination was subject to certain terms and conditions, including obtaining necessary approvals to enter into a definitive agreement.

Both partners determined that, in a share for share exchange transaction, the regulatory requirements in Taiwan would require an issuer to redeem dissenting shareholder interests for cash.

After considering the above listed point, both parties anticipated that this requirement would negatively affect the liquidity and capital resources of the combined company. As a result, both parties have mutually elected not to proceed with the signing of a definitive agreement.

Pacgen Biopharmaceuticals Corporation, a life sciences company, focuses on the development of peptide therapeutic drugs for the treatment of infectious and inflammatory diseases.

Medigen Biotechnology Corp. is a biopharmaceutical company that researches and develops anti-cancer and cardiovascular drugs.