FAST Fastnet Equity

TIDMFAST

RNS Number : 6263T

Fastnet Equity PLC

31 March 2016

Fastnet Equity plc

("Fastnet" or the "Company")

31 March 2016

Proposed Acquisition of Amryt Pharmaceuticals Designated Activity Company

Approval of a waiver of obligations under Rule 9 of the City Code

Capital Reorganisation

Placing of 41,673,402 New Ordinary Shares at 24 pence

per New Ordinary Share and issue of Placing Warrants

Change of name to Amryt Pharma plc

Changes to the Articles of Association

Readmission of the Enlarged Group to trading on AIM and ESM

Notice of General Meeting

Creating a specialty pharmaceutical company focused on best in class drugs in a US$176bn orphan drug market, with a lead product addressing a $1.5bn market opportunity

Following its announcement on 22 February 2016, Fastnet (AIM: FAST, ESM: FOI) today publishes an Admission Document detailing its conditional agreement to acquire the entire issued share capital of Amryt Pharmaceuticals DAC ("Amryt") for a consideration of GBP29.6 million to be satisfied by the issue of the Consideration Shares, (the "Acquisition"). The Company is also proposing to raise GBP10.0 million (before expenses) through a conditional placing of 41,673,402 New Ordinary Shares at the placing price of 24 pence per new Ordinary Share (equivalent to 3 pence per share before the Capital Reorganisation) and the issue of Placing Warrants on the basis of one Placing Warrant for every two Placing Shares subscribed.

Joe Wiley, Proposed CEO of Amryt Pharma plc, commented:

"Today's announcement is an important step towards realising the Company's vision of building a specialty pharmaceutical company focused on best in class treatments for Orphan Diseases. We are focused on building a portfolio of differentiated medicines, in therapeutic areas where there is large unmet medical need and which offer significant commercial potential.

"Importantly, the GBP10 million in new funds will enable us to accelerate the development of Episalvan(R) as a treatment for epidermolysis bullosa, a rare, debilitating, genetic skin disorder and orphan condition that typically affects young children and for which there is currently no approved therapy. We believe the recent European approval of Episalvan(R) for the treatment of Partial Thickness Wounds in adults and a successfully completed phase IIa trial in epidermolysis bullosa itself meaningfully de-risks the probability of approval in this indication."

The Acquisition constitutes a reverse takeover in accordance with Rule 14 of the AIM Rules for Companies and Rule 14 of the ESM Rules for Companies. Fastnet is seeking Shareholder approval for the Proposals at the General Meeting. Subject to approval of the Proposals, the Company will change its name to Amryt Pharma plc and begin trading under the new tickers "AMYT" (AIM) and "AYP" (ESM).

Amryt was incorporated in August 2015 as a platform to acquire, build, develop and subsequently monetise a pipeline of patent protected, commercially attractive, proprietary drug candidates targeting best in class performance chosen to meet the Orphan Drug Designation criteria. Where appropriate, the Enlarged Group will commercialise the drugs it successfully develops through its own salesforce. In line with this strategy, Amryt has entered into agreements, conditional, inter alia, on Admission to acquire both Birken AG ("Birken") and SomPharmaceuticals ("Som"). Birken is a revenue generating pharmaceutical development and manufacturing company based in Germany that has developed a recently approved drug for partial thickness wounds and promising potential orphan drug candidate for epidermolysis bullosa ("EB"). Som is a Swiss/US based biopharmaceutical company focused on developing novel somatostatin analogue peptide medicines for patients with rare neuroendocrine diseases with high unmet need, principally focused on additional orphan drug candidates to address acromegaly and Cushing's disease.

The New Board intends to use the net proceeds of the Placing to initiate a Phase III clinical trial of Episalvan with a view to obtaining a label extension for Episalvan to include approval for the treatment of EB in Europe and seek regulatory approval in the US.

Highlights

The New Board believes that following completion of the Acquisition, the Enlarged Group will have the following key strengths:

An approved drug - Birken's lead drug, Episalvan(R) , is a potential treatment for the orphan condition epidermolysis bullosa ("EB"), already approved in Europe as a treatment in adults for accelerated healing of partial thickness wounds ("PTWs") following three successful phase III studies.

-- EB is a rare and distressing genetic skin disorder typically affecting young children, where there is currently no approved treatment.

o EB leads to mechanical fragility of skin, characterised by the presence of recurrent PTWs and blisters as a result of mutations in structural proteins.

   --      Episalvan has been awarded Orphan Drug Designation ("ODD") in the US and EU for EB. 

-- The drug has successfully completed a Phase IIa study in ten EB patients (data from 12 wounds).

o Episalvan demonstrated significantly faster healing over 14 days of treatment for recent wounds and 28 days of treatment for chronic wounds compared with standard of care therapy.

   --      The global EB market is estimated to be worth approximately US$1.5 billion per annum. 

-- The drug received formal marketing approval from the European Commission on 14 January 2016 for the treatment in adults for accelerated healing of PTWs.

o PTWs involve loss of the epidermis and basement layers of skin extending into the dermis layer below.

o Episalvan effectively represents a new category of advanced wound care. management in PTWs and is targeting a market which the New Board assesses to be worth in excess of EUR150 million.

-- The Company intends to seek approval for Episalvan in EB in Europe and the US and will embark on a phase III study in H2 2016 in this indication.

A highly experienced management team - The New Board and senior management is comprised of experienced industry participants including:

-- Harry Stratford, Chairman, is the founder of Shire plc, now a FTSE 100 biopharmaceutical company, and ProStrakan Group plc

-- Joseph Wiley, CEO, has over 20 years' experience in healthcare investment and pharmaceutical operational roles

-- Rory Nealon, CFO and COO, has spent the last 13 years as both CFO and then COO of Trinity Biotech PLC, a NASDAQ listed company

-- Michele Bellandi, CCO, is the former Head of Commercial Europe for Shire AG International and has held senior marketing roles at Serono and Eli Lilly

-- Ray Stafford, a Non-Executive Director, previously EVP of Global Marketing for Forest Laboratories which was listed on NYSE prior to being acquired for approximately US$28 billion

-- James Culverwell, a Non-Executive Director, previously head of European pharmaceutical equity research at Merrill Lynch in London until 2005.

An attractive potential opportunity in Acromegaly/Cushing's disease

-- The Company estimates the Acromegaly and Cushing's disease markets to be in excess of US$1.15 billion per annum in aggregate

A business model that offers an attractive risk/reward profile

-- Recent approval of Episalvan together with Birken's existing Imlan(R) product line should appreciably lower the risk profile of the Company, whereas the opportunity in the EB and Acromegaly/Cushing's disease markets offers significant upside potential

-- The risks associated with obtaining regulatory approval in EB have been reduced following the European approval of Episalvan in PTWs in adults in Europe

Orphan Drug market represents a significant opportunity

   --      Worldwide orphan drug sales are forecast to total US$176bn (CAGR 2014 - 2020:+10.5%) 
   --      Orphan Drugs are set to be 19.1% of worldwide prescription sales by 2020 

-- Currently there are 7,000 orphan diseases with 1 in 10 of the world's population suffering from an orphan disease

Use of proceeds from the transaction include:

   --      Satisfying certain of the milestone payments now due as payable under the Birken SPA 

-- Fund the clinical trial costs associated with seeking approval of Epislavan as a treatment for EB

   --      Satisfy certain liabilities of Som under the Som SPAs; and 
   --      For general working capital purposes for the Enlarged Group. 

Unless the context otherwise requires, defined terms shall have the meaning ascribed to them in the Admission Document. The Admission Document is available on the Company's website www.fastnetequity.com

EXPECTED TIMETABLE OF PRINCIPAL EVENTS

 
 Publication and despatch of the                      31 March 2016 
  AIM Admission Document 
 Latest time and date for receipt             noon on 14 April 2016 
  of Proxy Forms for the General Meeting 
 General Meeting                              noon on 18 April 2016 
 Record Date for the Capital Reorganisation    close of business on 
                                                      18 April 2016 
 Admission, completion of the Acquisition,            19 April 2016 
  the Placing and commencement of 
  dealings in New Ordinary Shares 
 CREST accounts credited                              19 April 2016 
 Despatch of definitive share certificates            26 April 2016 
  in respect of New Ordinary Shares 
 

(MORE TO FOLLOW) Dow Jones Newswires

March 31, 2016 02:01 ET (06:01 GMT)

STATISTICS RELATING TO THE PROPOSALS

 
 Number of Existing Ordinary Shares                      345,369,071 
 Number of New Ordinary Shares following the 
  Capital Reorganisation and prior to Admission           43,171,134 
 Number of Consideration Shares to be issued             123,495,096 
 Number of Placing Shares to be issued                    41,673,402 
 Enlarged Share Capital following the Acquisition 
  and Placing                                            208,339,632 
 Number of existing warrants, Warrants and 
  Placing Warrants on Admission                           23,401,463 
 Number of outstanding options on Admission                4,946,162 
 Fully diluted enlarged issued share capital*            236,687,257 
 Placing Price                                                   24p 
 Gross proceeds of the Placing                       GBP10.0 million 
 Market capitalisation of the Company at the         GBP50.0 million 
  Placing Price on Admission 
 Consideration Shares expressed as a percentage 
  of the Enlarged Share Capital                                59.3% 
 Placing Shares expressed as a percentage of 
  the Enlarged Share Capital                                   20.0% 
 EPIC / TIDM                                                    AMYT 
 ESM Symbol                                                      AYP 
 ISIN following the Capital Reorganisation              GB00BDD1LS57 
 SEDOL following the Capital Reorganisation                  BDD1LS5 
 Irish SEDOL following the Capital Reorganisation            BDFYJ11 
 Exchange rate GBP:EUR                                          1.26 
 Exchange rate GBP:US$                                          1.41 
 Exchange rate US$:EUR                                          0.89 
 

*Note: On the basis that all existing warrants, Warrants, Placing Warrants and outstanding options in issue on Admission are exercised

Enquiries:

 
 Fastnet Equity plc                C/o FTI Consulting 
 Harry Stratford, Non-Executive 
  Director 
 
                                   +44 (0) 20 7408 
 Shore Capital                      4090 
 Lead Manager, Nomad and Joint 
  Broker 
 Bidhi Bhoma, Edward Mansfield 
 
 Davy                              +353 (1) 679 6363 
 ESM Adviser and Joint Broker 
 John Frain, Anthony Farrell 
 
                                   +44 (0) 20 7710 
 Stifel                             7600 
 Co-lead Manager 
 Jonathan Senior 
 
                                   +44 (0) 20 3727 
 FTI Consulting                     1000 
 Simon Conway, Brett Pollard 
 
   1.      Introduction 

The Company announces that it has, in line with the Company's Investing Policy adopted in August 2015, entered into a conditional agreement with the Vendors to acquire the entire issued share capital of Amryt for consideration of GBP29.6 million to be satisfied by the issue of the Consideration Shares. In addition, the Company is proposing to raise GBP10.0 million (before expenses) through a conditional placing of 41,673,402 New Ordinary Shares at the Placing Price and issue of Placing Warrants on the basis of one Placing Warrant for every two Placing Shares subscribed. Further details of the terms of the Acquisition and the Placing are set out below under the headings "Principal Terms of the Acquisition" and "Details of the Placing and the use of proceeds". Amryt was incorporated in August 2015 as a platform to acquire, build, develop and subsequently monetise a pipeline of patent protected, commercially attractive, proprietary drug candidates targeting best in class performance chosen to meet the Orphan Drug Designation criteria. Where appropriate, the Enlarged Group will commercialise the drugs it successfully develops through its own salesforce. Since incorporation, Amryt has received investment totaling EUR2.0 million to finance due diligence on potential target businesses and as working capital. In line with its strategy, Amryt has entered into agreements, conditional, inter alia, on Admission, to acquire the entire issued share capital of each of Birken and Som under the Birken SPA and Som SPAs respectively. Further information on Birken and Som is set out below.

The Acquisition constitutes a reverse takeover under the AIM Rules and ESM Rules. As a consequence, the Current Directors are seeking Shareholder approval for the Proposals at the General Meeting.

Irrevocable undertakings to vote in favour of the Resolutions have been obtained from the Current Directors and certain Shareholders.

Following Admission and the implementation of the Proposals, the Vendors, taking into account their holdings in Existing Ordinary Shares and following their participation in the Placing, will hold interests in 139,579,380 New Ordinary Shares representing 67.0 per cent. of the Enlarged Share Capital.

As part of the Proposals the Company intends to effect a Capital Reorganisation whereby every Existing Ordinary Shares will be consolidated into one New Ordinary Share and one Deferred Share.

The nature of the Company's business will be transformed by the Acquisition and, in order to reflect its new activities, it is proposed to change the Company's name to Amryt Pharma plc.

The proposed Acquisition, Waiver and Placing are conditional, inter alia, on the passing of the Resolutions and on Admission. It is expected that Admission will become effective and dealings in the Enlarged Share Capital will commence on AIM and ESM on 19 April 2016.

The Admission Document sets out the reasons for, and details of, the Proposals, to explain why the Current Directors consider that they are in the best interests of the Company and its Shareholders as a whole, and to recommend that you vote in favour of the Resolutions to be proposed at the General Meeting, notice of which forms part of the Admission Document.

   2.      Background information on Amryt 

Amryt was incorporated in August 2015 as a platform to acquire, build, develop and subsequently monetise a commercially attractive pipeline of drug candidates focused on treating orphan diseases. The founders of Amryt believe the Orphan Drug sector is a growing and commercially attractive segment of the pharmaceutical market as described further below.

Amryt was founded by Cathal Friel, Joseph Wiley and Rory Nealon. The New Board has extensive relevant healthcare and public company experience. Joseph Wiley, the proposed CEO of the Enlarged Group, has spent over 20 years in the healthcare sector, having initially trained as a medical doctor and subsequently worked in both healthcare investment and operational roles in the pharmaceutical industry. Most recently, he opened and led the European office of Sofinnova Ventures, a venture capital firm focused on the Life Science sector, where he was responsible for identifying and managing a number of investments in the biopharmaceutical space. Prior to this, Joseph Wiley was a Medical Director with Astellas where he liaised with the marketing team and was involved in the launch of a number of specialty pharmaceutical products. He is currently on the board of NASDAQ listed Innocoll AG, a specialty biopharmaceutical company.

Rory Nealon, the proposed CFO/COO of the Enlarged Group, is a qualified chartered accountant. He spent the last 13 years as both CFO and then COO of Trinity Biotech plc, a NASDAQ listed company that specialises in the development, manufacture and marketing of diagnostic test kits. Rory Nealon is a member of the Institute of Chartered Accountants in Ireland, the Institute of Taxation in Ireland and the Institute of Corporate Treasurers in the UK. The proposed New Board of the Enlarged Group also includes:

-- Harry Stratford, the founder of Shire plc, now a FTSE 100 specialty biopharmaceutical company, and ProStrakan Group plc;

-- Ray Stafford, previously Executive Vice President of Global Marketing for Forest Laboratories which was listed on NYSE prior to being acquired for approximately US$28 billion; and

-- James Culverwell, previously head of European pharmaceutical equity research at Merrill Lynch in London until 2005.

Michele Bellandi, the proposed CCO of the Enlarged Group, most recently was the Head of Commercial Europe for Shire AG International where he was responsible the entire portfolio representing over US$1.0 billion in revenues and over 600 employees. Before becoming Head of Europe he was General Manager of France, Spain and Portugal for the rare disease business and conducted multiple pricing negotiations of rare disease products. Prior to joining Shire AG International he was Global Marketing Director for the Neurology franchise at Serono (now Merck) where he was responsible for Rebif and led the international launch preparation of oral Cladribine. Previously he worked with Eli Lilly as Cymbalta Global Marketing Manager and in several other global marketing/sales management roles in the US, Italy and Japan.

Since incorporation Amryt has received EUR2.0 million in investment (via the issue of B Ordinary Shares and Convertible Debenture Securities) in order to complete the due diligence on potential target businesses and as working capital. In line with its strategy, Amryt has entered into agreements, conditional on Admission, to acquire the entire issued share capital of each of Birken and Som under the Birken SPA and Som SPAs respectively. Following the Acquisition and Admission, each of Amryt, Birken and Som will be wholly owned subsidiaries of the Company.

The New Board has a broad network of industry contacts. This is exemplified by the experienced advisers engaged by Amryt while it conducted its due diligence on Birken and Som, whose experience includes Pfizer and the US FDA. These contacts should also provide the Enlarged Group with access to additional prospective projects going forward and ensure a continuous pipeline of opportunities and further potential acquisitions, which will be assessed as they arise.

   3.      Key Strengths of the Enlarged Group 

The New Board believes that following completion of the Acquisition, the Enlarged Group will have the following key strengths:

(MORE TO FOLLOW) Dow Jones Newswires

March 31, 2016 02:01 ET (06:01 GMT)

-- An approved drug - Birken's lead drug, Episalvan, received formal marketing approval from the European Commission on 14 January 2016.

-- Significant market upside in Epidermolysis Bullosa ("EB") - Episalvan has successfully completed a Phase IIa study in ten EB patients (data from 12 wounds), in which Episalvan demonstrated significantly faster healing over 14 days of treatment for recent wounds and 28 days of treatment for chronic wounds compared with standard of care therapy. The New Board intends to pursue a label extension for Episalvan in Europe and seek FDA approval for Episalvan to treat EB in the US. The New Board estimates the global EB market to be worth approximately US$1.5 billion per annum.

-- Highly experienced management team - the New Board and senior management is comprised of experienced industry participants.

-- Attractive opportunity in Acromegaly/Cushing's disease - The New Board estimates the Acromegaly and Cushing's disease markets to be in excess of US$1.15 billion per annum in aggregate.

-- Business model offers an attractive risk/reward profile - the recent approval of Episalvan together with Birken's existing Imlan product line should appreciably lower the risk profile of the Enlarged Group whereas the opportunity in the EB and Acromegaly/Cushing's disease markets offers significant upside potential. Furthermore, the risks associated with obtaining regulatory approval in EB have been reduced following the recent approval of Episalvan for the indication of partial thickness wounds ("PTWs") in adults in Europe.

   4.      The Orphan Drug market 

The New Board believes that the Orphan Drug market represents a significant opportunity. Worldwide orphan drug sales are forecast to total US$176bn (CAGR 2014 to 2020:+10.5%) with Orphan Drugs set to be 19.1% of worldwide prescription sales by 2020. There are currently 7,000 orphan diseases with 1 in 10 of the world's population suffering from an orphan disease.

The US Orphan Drug Act of 1983, which was followed by legislation implementing similar provisions in Europe, introduced a number of financial incentives (including a period of market exclusivity after approval, as well as R&D grants and tax credits) to promote R&D in these typically under-served patient populations. In the US an Orphan Drug benefits from seven years of market exclusivity post approval for an orphan indication, while in Europe an Orphan Drug benefits from a ten year period of exclusivity. In addition to the financial incentives offered by regulators, the market for Orphan Drugs often has a number of attractive characteristics including:

-- free scientific advice and the waiver of regulatory fees, with Phase III trials costing, on average, 50% less;

-- a limited range of alternative drugs enabling companies to charge sustainable premium prices justified by the need to recoup development costs; and

-- small patient populations that are generally accessed through a limited number of channels enabling companies to use a specialty pharma model to market their products.

From 1983 to 2014 the number of approved Orphan Drugs in the US has increased from 38 to 373. The New Board believes this is a consequence of the regulatory support and incentives in place. The increase of approved Orphan Drugs is reflected in sales growth and share of the prescription drug market.

   5.      Birken 

Birken is a revenue generating pharmaceutical development and manufacturing company based in Germany that has developed a new therapy for the treatment of PTWs. Birken was founded by Dr. Armin Scheffler and has to date received EUR54 million of investment from the Software AG Stiftung Foundation, one of the largest charitable foundations in Germany. Birken's operations are based in the state of Baden Württemberg.

Birken's lead products are Episalvan (for the treatment of PTWs) and Imlan (a derma cosmetic range) which both use a betulin rich dry extract as their Active Pharmaceutical Ingredient ("API"). The API is believed to act via promoting the migration of keratinocytes (skin cells with wound repair capabilities) as well as transiently increasing the level of pro inflammatory mediators (which also promote healing). The nature of the API also enables formation of the emulsion that is used in the commercial production of gels and creams (without the need for additional emulsifiers or surfactants). Episalvan has completed three positive Phase III studies (two in the indication of split thickness skin graft donor sites (219 patients) and one in the indication of burn wounds (Grade 2a) (61 patients)) and one positive Phase IIa study (in the indication of EB). On 19 November 2015 it was recommended for approval by the CHMP of the EMA as a treatment for PTWs in adults. Marketing approval was subsequently received from the European Commission on 14 January 2016.

Episalvan has Orphan Drug Designation ("ODD") as a treatment for the hereditary skin disorder Epidermolysis Bullosa in both Europe and the US.

   5.1.   Active Pharmaceutical Ingredient ("API") 

Birken has developed patented technology around the discovery that its API can be readily and simply formulated as ointments (oleogels) and creams (emulsions) without the need for excipients or surfactants. Consequently, Birken's products have potential as topical medications as its API can be utilised to formulate topical products, with limited other ingredients. The API for both Episalvan and Imlan is a highly characterised extract that naturally occurs in birch bark. It is obtained through a patented process in which birch bark (cortex) is processed under carefully controlled conditions to yield a dry extract that contains c.80% betulin and other structurally related compounds account for another c.20% of the extract.

Betulin and the other components of the API have a number of different pharmacological properties. They are known to have antibacterial and antiinflammation effects to enhance keratinocyte migration which are believed to be important features for the acceleration of the healing process in PTWs.

Birken has important patent protection relating to the extraction, formulation and most importantly the method of use of betulin in the treatment of PTWs in Europe (including EB) and EB in the USA.

   5.2.   Episalvan 

Birken's lead product, which incorporates its API, is Episalvan, a pharmaceutical product which has been shown in clinical studies to accelerate wound healing in PTWs. Episalvan was recommended for approval by the CHMP of the EMA in November 2015 and received formal marketing approval from the European Commission on 14 January 2016.

The New Board believes that this product, when applied to wounds, offers a significant number of practical benefits to patients over other commercially available preparations containing betulin. These include the fact that it is occlusive, providing an air and watertight barrier for wounds, as well as additionally providing a shield against potential microbial infection. In addition, the New Board believes that the absence of excipients reduces the propensity for skin irritation. The formulation also forms a barrier between the wound and the dressings thereby reducing the opportunity for dressings to stick to the wound. The product is also stable for two years and requires no special storage conditions.

Birken has conducted a number of clinical trials using Episalvan that have demonstrated its efficacy and safety for the treatment of PTWs. These include two Phase III studies for the treatment of split thickness skin graft donor sites and a further Phase III study for the treatment of second degree burns. Across all studies Episalvan was both well tolerated and demonstrated accelerated wound healing compared with standard of care therapy. In addition, better long term outcomes across a number of parameters were demonstrated with Episalvan.

In these studies Episalvan was rated superior over Standard of Care by both physicians and patients as well as demonstrating better long term outcomes.

Episalvan also has an excellent safety profile, with fewer adverse events noted in the Episalvan treated side of the wounds (4 out of 280) against Standard of Care (18 out of 280).

   5.3.   Epidermolysis Bullosa 

Birken's API also obtained ODD for the treatment of EB (a hereditary skin disorder) from the EMA in February 2011 and the FDA in July 2014.

EB is a rare multi gene chronic connective tissue disorder with varying degrees of severity. EB leads to mechanical fragility of skin, characterised by the presence of recurrent blisters and PTWs as a result of mutations in structural proteins (e.g. keratins, laminins, collagens and integrins). Diagnosis of EB normally occurs in infancy and is classified into one of three major EB subtypes (junctional, dystrophic or simplex) according to the layer of cleavage within the skin. Although all forms of EB are considered serious, the most severe can be disfiguring, excruciatingly painful and lead to a number of complications including heightened risk of sepsis, skin cancer, severe anaemia, heart failure, cardiomyopathy, renal failure and can ultimately be fatal. To date, no drug has been approved to treat this condition and there therefore remains a substantial unmet need for drugs that can either cure or address the symptoms.

(MORE TO FOLLOW) Dow Jones Newswires

March 31, 2016 02:01 ET (06:01 GMT)

Birken has demonstrated positive data in EB in a Phase IIa clinical trial in 10 EB patients, with 12 wounds included. The trial compared the intra individual efficacy and tolerability of Episalvan versus non adhesive wound dressing alone in accelerating the healing of skin lesions in patients. In summary, the study demonstrated that Episalvan, combined with a non-adhesive wound dressing, significantly accelerated the skin healing (8 of 8 decided cases; p=0.0078, binomial test) of wounds in inherited EB compared to the use of non-adhesive wound dressing only (0 of 8 decided cases). Episalvan was also safe and well tolerated throughout the trial. It is the New Board's intention to conduct a Phase III confirmatory study in EB and thereafter seek marketing approval for this indication in both the EU and US.

   5.4.   Imlan 

Birken currently markets a range of derma cosmetics under the Imlan brand which are also based on the API betulin and a betulin emulsion. It comprises a range of skin care products to alleviate symptoms associated with dry and irritated skin such as eczema, psoriasis, atopic dermatitis, as well as treating damaged skin barriers and allergy prone skins. The products may also relieve itching and offer regenerative and anti-inflammatory properties. The cream formulation is suitable for use by babies, children and adults.

The Imlan range is currently sold exclusively through pharmacies in Germany and generated sales of EUR879,821 in the financial year ended 31 December 2014. As a derma cosmetic skin range, products are regulated under food legislation, including cosmetic GMP with registration at the BVL as well as requiring notification under the Cosmetic Product Notification Portal. The New Board intends to undertake a strategic review of the Imlan range in 2016, with opportunities being explored to develop Imlan as a registered medical device.

   6.      Som 

SomPharmaceuticals S.A. is a Swiss based biopharmaceutical company focused on developing novel somatostatin analogue ("SSA") peptide medicines for patients with rare neuroendocrine diseases with high unmet need. These disorders are caused by pituitary brain tumours that either over produce growth hormone ("GH"), leading to a disease known as Acromegaly or adrenocorticotropic hormone ("ACTH"), causing a disease known as Cushing's disease. Further opportunities in other neuroendocrine tumours ("NETs") may also be explored by the Enlarged Group in the future. First line treatment for these patients is surgical removal of the tumour. However, in many patients, surgery is non-curative and they have persistent disease that requires an alternative pharmaceutical therapy such as SSAs.

Acromegaly is a rare condition which affects approximately 62,000 people globally. Acromegaly has a distinct phenotype, with sufferers having enlarged hands and feet and coarsened, enlarged facial features. Joint paint and muscle fatigue can also be observed and internally, organs such as the liver, heart, kidneys and spleen can become enlarged. Acromegaly is additionally often associated with a number of health problems if left untreated, including Type 2 diabetes, colon polyposis, osteoarthritis, cardiovascular disease, high blood pressure, uterine fibroids, and sleep apnoea.

Cushing's disease is characterised by a variety of symptoms, which can develop rapidly and be very severe, or present more gradually and be milder in nature. Symptoms include weight gain and fat deposition and skin changes such as thinning and bruising. Musculoskeletal weakness in the hips, shoulders, arms and legs are also common, as are mental health issues such as depression and rapid mood swings.

Somtherapeutics Inc, the predecessor to Somtherapeutics Corp, was founded by Dr Alan Harris in 1999 to develop the next generation SSAs. Dr Harris was the clinician at Sandoz (now Novartis) responsible for the successful development of the first approved SSA, octreotide (Sandostatin(R)) for the treatment of Acromegaly patients who have persistent disease post-surgery. However, a large number of Acromegaly patients are resistant to octreotide and require an alternative treatment. AP102 is a new SSA developed by Som that targets not only the somatostatin receptor 2 ("SSTR2"), but unlike octreotide, also receptor 5 ("SSTR5") which is known to have an additional effect in reducing the effect of GH. Novartis has developed a drug, pasireotide (Signifor(R)) that also targets both SSTR2 and SSTR5 but the drug can also raise blood glucose levels, which can contribute to the development of diabetes.

Octreotide was developed to mimic the natural hormone Somatostatin-14. As such it selectively binds to SSTR2 and is comparable to Somatostatin-14. Subsequently, Pasireotide was developed by Novartis as a next generation drug to bind to both SSTR2 and SSTR5 as it is known that binding to both increases the effect on growth hormone. Pasireotide is particularly effective at binding to SSTR5 and does reduce growth hormone, but one of its side effects is a potential increase of blood glucose levels and hence the risk of contributing to the development of diabetes.

AP102 targets both SSTR2 and SSTR5 and the relative binding affinity to SSTR2 and SSTR5 is comparable. Initial pre-clinical studies show that AP102 does not cause an increase in blood glucose levels.

   7.      Market opportunity 

The Enlarged Group will utilise the net proceeds of the placing to focus on the opportunity presented within the EB market as described below. Subject to securing additional capital, which may come from alternative sources such as licencing deals or venture debt, the Enlarged Group would have the ability to exploit its other assets, Episalvan in respect of PTWs which has been approved for use in Europe and its preclinical assets focused on Acromegaly and Cushing's disease, each as described below.

   7.1.   Epidermolysis Bullosa 

There are estimated to be c.35,000 patients in Europe and c.30,000 in the U.S. with EB (Source: The Dystrophic Epidermolysis Bullosa Research Association (DEBRA) and Stanford School of Medicine, "Epidermolysis Bullosa Clinic"). The subtypes of the EB population are estimated to be distributed as follows: i) junctional subtype, the most severe/rare, occurring at c.8%, ii) dystrophic (c.31%), and iii) simplex (c.61%) as the most common/least severe.

There remains a significant unmet need in this disease with, as of yet, no specific approved therapy available. Four approaches have shown early promise in the treatment of EB: gene therapy, fibroblast therapy, bone marrow therapy and protein therapy (Soro et al. 2015). However, all of these approaches are still many years away from the market and would need to undergo extensive evaluation in clinical trials over a number of years. Episalvan has been developed as a treatment for the symptoms of EB and, as such, will not be curative but rather accelerate wound healing in these patients, with potential additional benefits on pain, itch and long term outcomes.

In September 2015, Amicus acquired Scioderm Inc for US$842 million (subject to the achievement of certain clinical, regulatory and commercial milestones). Scioderm also has a topical product (Zorblisa) in development for the treatment of the symptoms of EB. JP Morgan's analyst report (8 September 2015) on Amicus estimates the market potential for Zorblisa to be more than US$1 billion in annual peak sales and noted that Amicus is currently recruiting patients in a Phase III study in Europe and the US. If Zorblisa is approved, Episalvan would be the second product to market in this indication. The New Board expects to begin a Phase III study in EB in Q1 2017, with headline data available at the end of H1 2018. In this context, the New Board intends to follow the predefined regulatory pathway which has been agreed by Amicus with the FDA and EMA. However, unlike in the Zorblisa Phase III study, it is expected that Episalvan will not require daily dressing changes, which is considered by the New Board to be a burden for EB patients and which, the New Board believes, could be a significant competitive advantage.

   7.2.   Treatment of Partial Thickness Wounds in Adults 

The wound care management market is a diverse and highly complex landscape. Products are divided into traditional solutions, such as tissue adhesives, seals and glues, anti infective dressings, basic wound care (tapes, dry dressings, cleansing), therapeutic devices or more advanced wound care which typically include films, foam dressings, collagens, alginates, hydrocolloids, hydrogels, super absorbers and biologicals (artificial skin and skin substitutes). To date, treatment for PTWs has been addressed by the use of over the counter ("OTC") antiseptic hydrogels such as octenidine or polihexanide, anti infectant creams such as Flammazine(R) (active ingredient silversulfadiazine), traditional wound care solutions (e.g. dressings and cleansings) or more advanced wound care dressings (e.g. silicone wound contact layers).

Subject to securing finance in addition to the net proceeds of the Placing, it is the New Board's intention that Episalvan will be a first in class prescription pharmaceutical treatment with proven efficacy initially targeting wounds in surgical specialities, such as second degree burns and split thickness skin graft donor sites. Currently, Episalvan has a clearly defined competitive advantage by incorporating an innovative formulation with a novel API to treat an unmet need for the wide range of wound types .

   7.3.   Size of the total addressable market for PTWs 

The global wound care market is expected to grow at a CAGR of 5% from EUR18.6 billion in 2011 to EUR25.7 billion in 2018 (Wound Care Management Market to 2018, GBI Research, Global Business Intelligence, GBIME0066MR, June 2012).

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The size of the total addressable PTWs market for Episalvan in Europe has been assessed by the New Board to approximate 700,000 patients in the top 10 European markets given the broad label that has been approved by the EU (that is the treatment of PTWs in adults). The New Board has made an assessment of the value of this addressable market in Europe at over EUR150 million. This is based on assumptions around uptake of Episalvan. However, as a first in class pharmaceutical product to accelerate wound healing, Episalvan effectively represents a new category of advanced wound care management.

   7.4.   Acromegaly and Cushing's disease 

Acromegaly is prevalent in an estimated 62,000 patients worldwide. The current treatment of choice is surgery with approximately 16,000 patients in Europe and the US requiring ongoing therapy, usually with an SSA such as Octreotide or Lanreotide. The New Board estimates the market for SSAs at c.US$2.0 billion, with c.US$650 million for Acromegaly alone in the US and EU. The remainder of the market includes use of SSAs for Cushing's disease and the treatment of other NETs.

Notably, no other therapy currently in development other than AP102 is targeting both SSTR2 and SSTR5.

Up to 70% of patients are resistant to Octreotide therapy and therefore require some additional treatment. Novartis developed Pasireotide (Signifor) to address this unmet need as it targets SSTR2 and SSTR5, which, when combined are known to have a more profound effect on growth hormone secretion (Octreotide mainly targets SSTR2). However, pasireotide may contribute to the development of diabetes which may consequently limit its usage in clinical practice. Som has developed an SSA (AP102) that targets both SSTR2 and SSTR5 without raising glucose levels in a pre-clinical model and therefore it has the potential to have a better side effect profile than Pasireotide as it may not cause diabetes. The Enlarged Group intends to take AP102 into the clinic and conduct a proof of concept study in resistant Acromegaly and/or Cushing's disease, subject to having raised sufficient capital to do so. The New Board estimates the market opportunity (assuming successful clinical trials and a commercial launch) for AP102 to be c.US$650 million in Acromegaly and c.US$500 million in Cushing's disease.

   8.      Strategy 

The New Board's strategy is for the Enlarged Group to acquire, build, develop and commercialise a portfolio of medicines focused on rare and orphan diseases. Following the recent approval of Episalvan in the EU, demonstrating the efficacy and safety in PTWs healing, the New Board believes the risk of obtaining regulatory approval for Episalvan to treat EB is reduced. Consequently, the New Board intends to use the net proceeds of the Placing to progress a Phase III clinical trial of Episalvan with a view to obtaining a label extension for Episalvan to include approval for the treatment of EB in Europe and seek approval in the US.

   8.1.   Episalvan in respect of EB 

As a product designed for the treatment of the symptoms of an orphan disease, developing Episalvan in EB will require significant involvement of patient advocacy groups such as DEBRA. Amryt has been in active discussions with DEBRA and it is the New Board's intention to involve EB patients at every level of its Episalvan development plan. This will include conducting patient advisory, as well as scientific advisory panels to assist in the design of clinical studies so that patient feedback becomes fully integrated into the design of the Phase III clinical studies. In the US, Amryt's management has already begun the process of engaging with specialty pharmacy groups who can provide a full service offering to patients to ensure that all patients will have equal access to this new therapy. There are 15 specialist EB centres in the USA and a small number in each individual European country. In light of the limited number of centres and Key Opinion Leaders ("KOLs"), the New Board believes that establishing a strong partnership coupled with an individualised approach based on projects/studies that meet the Company's and KOL's shared needs and interests will be pivotal to the success of the Company. The Enlarged Group's management has good experience of developing these networks. Given the limited number of patients affected by rare diseases and the limited number of specialist centres the New Board believes it should also be possible for the Enlarged Group to conduct the development and commercialisation of Episalvan alone without the need for a local partner. In Europe, given the diverse nature of healthcare structures in place in different countries, the New Board's strategy is to engage with the local authorities on a country by country basis to ensure prompt availability of Episalvan once approved.

The expected launch preparation will be based on four key phases:

   i.      Seed phase - understanding the specific market requirements and needs; 

ii. Shaping phase - key centre identification coupled with development of relationships with and lobbying of patient organisations;

iii. Key market launch - organisation established and set up alongside the implementation of an early access programme; and

iv. Expansion - establishing organisational networks in second tier countries. The New Board intends to leverage off the sales infrastructure established as a result of commercialising Episalvan in relation to PTWs to address the EB market in Europe.

   8.2.   Episalvan in respect of PTWs 

Subject to securing finance in addition to the net proceeds of the Placing, the New Board intends to commercialise Episalvan in Europe as a specialty pharmaceutical product possibly utilising an outsourced sales force model. Specialty pharmaceuticals can benefit from more focused sales and marketing strategies as products are limited to a small numbers of centres with specialty expertise that are often tertiary referral centres. This requires a small sales force and should enable the Enlarged Group to commercialise products without the need for a commercial partner and/or a large sales team. The New Board's intention is that, once additional funding is secured, the marketing function could be performed via the well validated outsourcing model using one of a number of providers. The advantage of this model is that it provides flexibility to small companies without a sizable increase in fixed overheads. Once launched sales and marketing will be managed centrally by Michele Bellandi, the Enlarged Group's Chief Commercial Officer. Even though the indication for Episalvan is wide (the treatment of PTWs in adults), the intention is to target speciality hospitals including burns units as they treat the patients with the highest unmet medical need. National reimbursement will not be sought in this indication, as Episalvan will only be available through hospitals and specialist centres and not be made generally available in the community. Instead, addition to hospital formularies only will be sought, with reimbursement at the hospital level where price points are accepted, making pricing simpler. The New Board will seek to enter into licencing deals in relation to Episalvan for territories outside of the US and EU and has already commenced early stage discussions in this regard.

   9.      Principal Terms of the Acquisition 

Under the terms of the Acquisition Agreement, the Company has conditionally agreed to acquire Amryt from the Vendors, for a consideration of GBP29.6 million to be satisfied by the issue of 123,495,096 New Ordinary Shares (being the Consideration Shares) representing 59.3 per cent. of the Enlarged Share Capital.

The Acquisition Agreement is conditional, inter alia, on the passing of the Resolutions, Admission and all of the conditions under the Birken SPA and Som SPAs being satisfied other than Admission.

   9.1.   Birken SPA 

On 16 October 2015, Amryt entered into the Birken SPA. Completion under the Birken SPA is conditional, amongst other things, on Admission. Under the terms of the Birken SPA, the Birken Sellers will receive:

   --     an initial payment of EUR1 million, which was settled on signature of the Birken SPA; 
   --     EUR150,000 on completion; 

-- milestone payments totalling up to EUR50 million payable on achieving certain regulatory approvals and sales targets in relation to Episalvan, of which EUR10 million is payable on Admission following the receipt of approval of Episalvan by the European Commission; and

   --     royalties of 6-9% on sales of Episalvan for ten years from first commercial sale. 

Additionally, the Birken Sellers will be issued with new ordinary shares in Amryt representing 30.0 per cent. of the fully diluted issued share capital of Amryt following the issue of:

i) consideration shares issued in Amryt in relation to the Som SPAs referred to below; and

ii) shares issued in Amryt as a result of the conversion of the B Ordinary Shares and CDS, but prior to any dilution resulting from the transaction.

These new ordinary shares in Amryt will be acquired by the Company pursuant to the Acquisition Agreement.

   9.2.   Som SPAs 

Amryt entered into conditional SPAs to acquire each of SomPharmaceuticals S.A and Somtherapeutics, Corp on 15 December 2015 and 4 December 2015 respectively (together the "Som SPAs"). Under the terms of the Som SPAs, Amryt will:

-- pay a maximum sum of US$100,000 in cash in respect of the acquisition of Somtherapeutics, Corp (of which Alan Harris is the sole shareholder) less Somtherapeutics, Corp's liabilities to the extent that these are more than $150,000; and

-- pay US$4.15 million in respect of the acquisition of SomPharmaceuticals S.A in new ordinary shares in Amryt, in respect of which the Som Sellers will receive 12,277,102 Consideration Shares under the Acquisition Agreement.

These new ordinary shares in Amryt issued pursuant to the Som SPAs will be acquired by the Company pursuant to the Acquisition Agreement.

   10.    Patent Portfolio 

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The New Board has a proactive approach to obtaining and enhancing intellectual property rights for products which it acquires. These rights will be enhanced by actively seeking ODD in both Europe and the USA, which grants marketing exclusivity for the Enlarged Group's products of ten years and seven years respectively in those jurisdictions.

Significantly the Enlarged Group has obtained patent approval in the EU for the use of Episalvan in the treatment of PTWs and has recently obtained a method of use patent in the USA for the use of the product in the treatment of EB.

   11.    Current trading and prospects 

On 28 August 2015, the Company became an investing company under the AIM Rules and ESM Rules. As at 30 September 2015, the Company had a cash balance of US$15.5 million (EUR13.8 million), having incurred a loss of US$1.5m during the period. Subsequent to the financial period, on 17 December 2015, the Company demerged its oil and gas subsidiaries into a separate company, Fastnet Hydrocarbons Limited. The shares of Fastnet Hydrocarbons Limited are held in trust for the benefit of shareholders on the register of the Company as at the close of business on 16 December 2015.

The Company's cash balance was EUR12.1 million as at 29 March 2016, which is subsequent to the grant in December of an unsecured four year term loan to Fastnet Hydrocarbons Limited of EUR660,000 to finance residual running of the legacy oil and gas assets. The Company no longer has any on-going interest or further cost exposure in respect of its historic oil and gas assets other than this loan.

   12.    Details of the Placing and use of proceeds 

The Company is proposing to raise approximately GBP10.0 million (before expenses) by the issue of 41,673,402 New Ordinary Shares at the Placing Price and granting the Placing Warrants on the basis of one Placing Warrant for every two Placing Shares subscribed. The Placing Shares will represent approximately 20.0 per cent. of the Enlarged Share Capital. The Placing Shares will rank pari passu in all respects with the New Ordinary Shares including the rights to all dividend and other distributions declared, made or paid following Admission and will be issued credited as fully paid. The Placing has not been underwritten.

The EIS Placing Shares will be issued to investors seeking to benefit from the tax advantages pursuant to the VCT and/or EIS legislation. The Company has obtained advance assurance from HMRC that the EIS Placing Shares will satisfy the requirements for tax relief under EIS.

The Placing Warrants are exercisable on or before 31 December 2018.

The proceeds of the Placing together with the existing cash balance within the Enlarged Group will be used to:

   --     satisfy certain of the milestone payments now due as payable under the Birken SPA; 

-- fund the clinical trial costs associated with seeking approval of Epislavan as a treatment for EB;

   --     satisfy certain liabilities of Som under the Som SPAs; and 
   --     for general working capital purposes for the Enlarged Group. 

The Placing is conditional, inter alia, on:

-- the Placing Agreement becoming unconditional and not having terminated in accordance with its terms prior to Admission; and

-- Admission occurring by no later than 19 April 2016 (or such later date as Shore Capital, Davy and the Company may agree, being no later than 21 April 2016).

   13.    Capital Reorganisation 

The mid-market price of the Existing Ordinary Shares as at the close of business on 30 March 2016 was 2.85p which is below their nominal (or par) value of 3.8p per Existing Ordinary Share. The issue of new shares by an English company at a price below their nominal value is prohibited by English company law and accordingly the ability of the Company to raise funds by way of the issue of further equity is restricted.

Consequently, the Company is proposing the Capital Reorganisation to reduce the nominal (or par) value of the Existing Ordinary Shares substantially below their market price in order to provide the Company with the ability to make future share issues (including the proposed Placing). In addition, the share price levels at which the Existing Ordinary Shares have recently traded means that small absolute movements in the share price represent large percentage movements resulting in share price volatility. The Current Directors believe that the bid offer spread at these price levels can be disproportionate and to the detriment of Shareholders. Accordingly, the Current Directors have decided to implement a share reorganisation such that:

each holding of every 8 or more Existing Ordinary Shares

will be consolidated into one New Ordinary Share and one Deferred Share.

Holders of fewer than 8 Existing Ordinary Shares will not be entitled to receive a New Ordinary Share or Deferred Share following the Capital Reorganisation. Shareholders with a holding in excess of 8 Existing Ordinary Shares, but which is not exactly divisible by 8, will have their holding of New Ordinary Shares rounded to the nearest whole number of New Ordinary Shares following the Capital Reorganisation. Fractional entitlements, whether arising from holdings of fewer or more than 8 Existing Ordinary Shares, will be sold in the market and the proceeds will be retained for the benefit of the Company.

The Existing Ordinary Shares have been admitted to CREST. Application will be made for the New Ordinary Shares to be admitted to CREST, all of which may then be held and transferred by means of CREST. It is expected that the New Ordinary Shares arising as a result of the Capital Reorganisation in respect of Existing Ordinary Shares held in uncertificated form, i.e. in CREST, will be credited to the relevant CREST accounts on 19 April 2016 and that definitive share certificates in respect of the New Ordinary Shares arising as a result of the Capital Reorganisation from Existing Ordinary Shares held in certificated form will be despatched to relevant Shareholders within 10 business days of completion of the Capital Reorganisation. No temporary documents of title will be issued. Share certificates in respect of Existing Ordinary Shares will cease to be valid at close of business on 18 April 2016 and, pending delivery of share certificates in respect of New Ordinary Shares will be certified against the register. The Capital Reorganisation Record Date is 18 April 2016.

As a consequence of the Capital Reorganisation, each Shareholder's holding of New Ordinary Shares will (ignoring fractional entitlements) immediately following the Capital Reorganisation becoming effective be one eighth of the number of Existing Ordinary Shares held by them on the Capital Reorganisation Record Date. However, each Shareholder's proportionate interest in the Company's issued ordinary share capital will remain unchanged as a result of the Capital Reorganisation.

The Deferred Shares created will be effectively valueless as they will not carry any rights to vote or dividend rights. In addition, holders of Deferred Shares will only be entitled to a payment on a return of capital or on a winding up of the Company after each of the holders of New Ordinary Shares have received a payment of GBP10,000,000 on each such share. The Deferred Shares will not be listed or traded on the Official List, AIM, the ESM or any other investment exchange and will not be transferable save that upon the death of any holder of the Deferred Shares such shares will be permitted to be transmitted under the terms of the deceased Shareholder's will provided that the persons to whom they are to be transmitted are a Privileged Relation of the deceased Shareholder. No share certificates will be issued in respect of the Deferred Shares, nor will CREST accounts of shareholders be credited in respect of any entitlement to Deferred Shares. In addition, the directors of the Company may arrange for the Company to effect a re purchase of the Deferred Shares, for a consideration of GBP0.01 (1 pence) for all of the Deferred Shares in issue, subject to due compliance with all relevant legislation.

The ISIN of the New Ordinary Shares will be GB00BDD1LS57 following the Capital Reorganisation.

   14.    Related Party Transaction 

Cathal Friel, Nonexecutive Chairman of Fastnet, is a director and, taking into account the proposed issue of shares by Amryt to the Birken Sellers and Som Sellers, 22.8 per cent. shareholder of Amryt prior to the acquisition by Fastnet and associated Placing (including for these purposes shares held by Raglan Capital, a company of which he is a director and shareholder). The Acquisition is consequently a related party transaction under Rule 13 of the AIM Rules and ESM Rules. The Independent Directors consider, having consulted with Shore Capital in respect of the AIM Rules and Davy in respect of the ESM Rules, that the terms of the Acquisition are fair and reasonable insofar as Shareholders are concerned.

15. Information on the Current Directors, Proposed Directors, Advisory Board and Senior Management

The directors of the Company as at the date of this announcement comprise Cathal Friel, Harry Stratford, Michael Nolan and Michael Edelson. On Admission, Michael Nolan and Michael Edelson will resign as non-executive directors with immediate effect and Cathal Friel and Harry Stratford will continue as non-executive directors of the Company, with Harry Stratford becoming Non-Executive Chairman.

On Admission, Joseph Wiley and Rory Nealon will join the New Board as CEO and CFO/COO respectively, while Ray Stafford and James Culverwell will be appointed as non-executive directors. Harry Stratford will become Non-Executive Chairman and Rory Nealon will become company secretary on Admission.

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Under the Acquisition Agreement, the Birken Sellers may within three months of completion nominate in writing a person to be appointed as a non-executive director of the Company and the Company shall make such appointment promptly following receipt of such nomination, subject always to SCC and Davy having undertaken and being satisfied with relevant due diligence to confirm that the person so nominated is suitable to be a director of a company whose share capital is admitted to trading on AIM and ESM.

Brief summaries of the biographies of each of the Current Directors and Proposed Directors are set out below:

   15.1.       Current Directors 

Cathal Martin Friel (aged 51), Non-Executive Chairman and proposed Non-executive Director

Mr Friel is managing director and one of the founders of Raglan Road Capital Limited (which trades as Raglan Capital), a Dublin and London based corporate finance and merchant banking group. Mr Friel has over 25 years of managerial, entrepreneurial and corporate finance experience, as well as successfully advising major UK and Irish companies on domestic and international transactions.

He was previously one of the founding directors of Dublin based Merrion Corporate Finance, where he helped build Merrion to becoming one of Ireland's top three corporate finance and stockbroking firms in less than 6 years, before successfully selling it for approximately EUR100 million in 2006.

Harry Thomas Stratford (aged 68), Non-executive Director and proposed Non-Executive Chairman

Mr Stratford has over 40 years' experience in the pharmaceutical industry and has built two successful publicly listed pharmaceutical companies. Mr Stratford founded Shire Plc in 1986 and was CEO for almost a decade. Shire Plc grew from humble beginnings to be one of Europe's largest specialty pharmaceutical companies and its stock is a constituent of the FTSE100 index. Mr Stratford then went on to be founder, CEO and Executive Chairman of Prostrakan Plc, another international specialty pharmaceutical company, which was subsequently acquired by Kyowa Hakko Kirin of Japan in 2011.

Mr Stratford holds a BSc. in Chemistry from the University of London and was awarded an OBE in the 2007 New Year's Honours list for his contribution to the Scottish Life Sciences Industry.

John Michael Edelson (aged 71), Non-executive Director

Mr Edelson has been on the board of Fastnet Equity Plc in a non-executive capacity since he founded the Company (then called Hamilton Partners plc). Since 1990 he has founded and been on the board of many listed companies, mostly on AIM, including ASOS (formerly Brindle plc), Magic Moments plc, Knutsford Group plc, Mercury Recycling Group plc, Prestbury Group plc and Singer & Friedlander AIM 3 VCT plc.

He has been a member of the board of Manchester United Football Club Limited since 1982.

Michael Henry Nolan (aged 54), Non-executive Director

Mr Nolan was a founding director of Terra Energy Limited which was acquired by Fastnet in 2012. Mr Nolan is a Chartered Accountant having worked in practice with Deloitte in Dublin. From 2009 to 2012 Mr Nolan was a director and member of the management team of Cove Energy Plc which was sold to PTTEP of Thailand in August 2012. He acts as a non-executive director of Vancouver based, Rathdowney Resources Limited, a private natural resource company operating in Europe and supported by the Hunter Dickinson group and listed on TSXV. He is also a director of AIM companies, Tiger Resource Finance plc and Orogen Gold plc. He acted as chief executive officer of AIM listed, mining company, Minmet Plc from 1999 to 2007. He also serves on the board of several resource exploration and investment companies.

   15.2.       Proposed Directors 

Joseph Amrit Wiley (aged 45), CEO

Mr Wiley founded Amryt and is a non-executive director of NASDAQ listed Innocoll AG. Mr. Wiley has over 20 years of experience in the pharmaceutical, medical and venture capital industries. Mr Wiley opened and led Sofinnova Ventures' European office. He was previously a medical director at Astellas Pharma where he liaised with the marketing team and was involved in the launch of a number of speciality pharmaceutical products. Prior to joining Astellas, he held investment roles at Spirit Capital, Inventages Venture Capital and Aberdeen Asset Managers (UK). Mr Wiley trained in general medicine at Trinity College Dublin, specialising in neurology. He has an MBA from INSEAD and is also a Member of the Royal College of Physicians in Ireland.

Rory Peter Nealon (aged 48), CFO/COO

Mr Nealon was previously a board member of Trinity Biotech Plc joining as Chief Financial Officer in January 2003. He was subsequently appointed Chief Operations Officer in November 2007. Mr Nealon left Trinity in 2014. Prior to joining Trinity Biotech Plc, he was Chief Financial Officer of Conduit plc, an Irish directory services provider with operations in Ireland, the UK, Austria and Switzerland. Prior to joining Conduit he was an Associate Director in AIB Capital Markets, a subsidiary of AIB Group plc, the Irish banking group. Mr Nealon holds a Bachelor of Commerce degree from University College Dublin, is a Fellow of the Institute of Chartered Accountants in Ireland, a member of the Institute of Taxation in Ireland and a member of the Institute of Corporate Treasurers in the UK.

Ray Thomas Stafford (aged 69), Non-executive Director

Mr Stafford has worked in the pharmaceutical industry for thirty years, he was Chairman, CEO and majority shareholder of the Tosara Group who owned, manufactured and marketed the successful international brand Sudocrem. Following the integration of Tosara into the U.S. based NYSE listed company Forest Laboratories in 1988 Mr Stafford held numerous senior positions within that corporation including CEO Forest UK and Ireland, CEO Forest Europe and since 1999 to him retiring from the business in 2014 following the sale of Forest to Actavis (Allergan) in a US$28bn transaction Mr Stafford was Executive Vice President Global Marketing. Separately Mr Stafford was founder of what is today one of Ireland's leading multichannel sales, marketing and distribution service providers approved by the Irish Medicines Board to service the wholesale and retail trade.

Anthony James Culverwell (aged 59), Non-executive Director

Mr Culverwell is a non-executive director of NASDAQ listed Innocoll AG and has over 30 years' experience in analysing and valuing pharmaceutical companies. Mr Culverwell joined Hoare Govett in 1982, and then moved to Merrill Lynch in 1995, where he became head of European pharmaceutical equity research. In 2004, Mr Culverwell set up Sudbrook Associates, a healthcare corporate adviser. Mr Culverwell currently sits on the board of four companies in the specialty pharmaceutical, drug development and diagnostic fields. Mr Culverwell has an MSc from the University of Aberdeen.

   15.3.       Senior Management 

Michele Bellandi is joining the Enlarged Group as Chief Commercial Officer and has accepted an offer of employment, effective from 1 April 2016. Dr Tobias Zahn will become an employee of the Enlarged Group on Admission and Alan Harris will take up the role as Head of the scientific advisory board, following completion of the Birken SPA and Som SPAs. Brief summaries and biographies are set out below:

Michele Bellandi, Chief Commercial Officer

Mr Bellandi has over 20 years' experience in the pharmaceuticals industry with a focus on rare diseases. He was most recently the Head of Commercial Europe for Shire AG International Plc where he was responsible for the entire portfolio representing over US$1.0 billion in revenues and over 600 employees. Before becoming Head of Europe he was General Manager of France, Spain and Portugal for the rare disease business and conducted multiple pricing negotiations of rare disease products. Prior to joining Shire AG International he was Global Marketing Director for the Neurology franchise at Serono (now Merck & Co., Inc) where he was responsible for Rebif and led the international launch preparation of oral Cladribine. Previously he worked with Eli Lilly & Company as Cymbalta Global Marketing Manager and in several other global marketing/sales management roles in the US, Italy and Japan. Mr Bellandi holds a Masters in Economics from Pisa University and a Masters in Business Administration from CUOA Business School (Italy).

Alan Harris, Chairman, Scientific Advisory Board

Mr Harris was chairman and founder of Som. Prior to founding Som, Mr Harris headed Clinical Development of octreotide (Sandostatin(R)) at Sandoz (Novartis) which was approved for the treatment of malignant neuroendocrine tumors and Acromegaly which remains 25 years later the leading treatment for these diseases.

Dr. Tobias Zahn, Head of Clinical Operations

Mr Zahn joined Birken in 2009 and was responsible for the development of Episalvan. Prior to that he worked from 2005 to 2008 as a consultant at The Boston Consulting Group and from 2003 to 2004 as postdoc at the Max Planck Institute for Molecular Cell Biology and Genetics in Dresden. He holds a Masters degree in Biochemistry and a PhD in Cell Biology both from Witten/Herdecke University, Germany. He has conducted research at the University of Colorado Health Sciences Center.

   16.    The City Code on Takeovers and Mergers 

The Company is subject to the Code. Brief details of the Panel, the Code and the protections they afford are described below.

The Code is issued and administered by the Panel. The Code applies to all takeover and merger transactions, however effected, where the offeree company is, inter alia, a listed or unlisted public company resident in the United Kingdom, the Channel Islands or the Isle of Man (and to certain categories of private limited companies). The Company is a public company resident in the United Kingdom and its shareholders are therefore entitled to the protections afforded by the Code.

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Under Rule 9 of the Code ("Rule 9"), where any person acquires, whether by a series of transactions over a period of time or not, an interest in shares (as defined in the Code) which (taken together with shares already held by him and any interest in shares held or acquired by persons acting in concert with him) carry 30 per cent. or more of the voting rights of a company which is subject to the Code, that person is normally required to make a general offer to all the holders of any class of equity share capital or other class of transferable securities carrying voting rights in that company to acquire the balance of their interests in the company.

Rule 9 of the Code also provides that, among other things, where any person who, together with persons acting in concert with him, is interested in shares which in aggregate carry not less than 30 per cent. but does not hold shares carrying more than 50 per cent. of the voting rights of a company which is subject to the Code, and such person, or any person acting in concert with him, acquires an additional interest in shares which increases the percentage of shares carrying voting rights in which he is interested, then such person is normally required to make a general offer to all the holders of any class of equity share capital or other class of transferable securities carrying voting rights of that company to acquire the balance of their interests in the company.

An offer under Rule 9 must be in cash (or with a cash alternative) and at the highest price paid within the preceding 12 months for any shares in the company by the person required to make the offer or any person acting in concert with him.

Rule 9 of the Code further provides, among other things, that where any person who, together with persons acting in concert with him holds over 50 per cent. of the voting rights of a company, acquires an interest in shares which carry additional voting rights, then they will not generally be required to make a general offer to the other shareholders to acquire the balance of their shares.

For the purposes of the Code, persons acting in concert comprise persons who, pursuant to an agreement or understanding (whether formal or informal), actively co-operate, through the acquisition by them of shares in a company, to obtain or consolidate control of that company.

   17.    Concert Parties 

Certain persons are considered to be acting in concert with each other in relation to the Company for the purposes of the Code following Admission. There are three such concert parties, being the Amryt Concert Party, the Som Sellers and the Birken Sellers. Following completion of the Proposals, the Birken Sellers will hold, in aggregate, 43,656,955 New Ordinary Shares, representing 21.0 per cent. of the Enlarged Share Capital and the Som Sellers will hold, in aggregate, 12,277,102 New Ordinary Shares, representing 5.9 per cent. of the Enlarged Share Capital.

Following completion of the Proposals, the Amryt Concert Party will hold, in aggregate, 83,645,323 New Ordinary Shares, representing 40.1 per cent. of the Enlarged Share Capital. In addition, certain members of the Concert Party will, on Admission, hold 4,130,208 options and/or 2,225,728 warrants to subscribe for New Ordinary Shares in the Company on Admission. Should these options and/or warrants be exercised by those members of the Concert Party and assuming no other New Ordinary Shares are issued, the Concert Party's maximum holding would be 90,001,259 New Ordinary Shares, representing 41.9 per cent. of the Company's then enlarged share capital which, without a waiver of the obligations under Rule 9, would oblige the Concert Party to make a general offer to Shareholders under Rule 9. Following Admission, Rule 9 will continue to apply to the Amryt Concert Party, requiring a general offer to be made on any further acquisition of interests in New Ordinary Shares by the Amryt Concert Party (unless a waiver is obtained or the Amryt Concert Party acquires more than 50 per cent. of the voting rights in the Company).

Following an application by the Independent Directors, the Panel has agreed, subject to the approval of the Waiver Resolution on a poll by Independent Shareholders at the General Meeting, to grant the Waiver. The effect of the Waiver, if the Waiver Resolution is approved by Independent Shareholders, would be that the Amryt Concert Party would not be subject to a requirement to make a general offer under Rule 9 that might otherwise arise as a result of the Proposals. The Amryt Concert Party or any member of the Amryt Concert Party will not be restricted from making an offer for the New Ordinary Shares which it will not own following Admission.

The Waiver Resolution is subject to the approval of a simple majority of the Independent Shareholders on a poll and each Independent Shareholder will be entitled to one vote for each Existing Ordinary Share held. To be passed, the Waiver Resolution will require the approval of a simple majority of votes cast on that poll.

Cathal Friel, Non-Executive Chairman of Fastnet and director and shareholder of Amryt, holds (including holdings by Raglan Capital, a company owned by him and his wife Pamela Iyer) 39,751,525 Existing Ordinary Shares (representing 11.51 per cent of the Existing Ordinary Shares) and shares in Amryt and is a member of the Amryt Concert Party and is therefore considered a Non-Independent Director.

Following completion of the Proposals, the members of the Amryt Concert Party will be interested in New Ordinary Shares which carry more than 30 per cent. but would not hold more than 50 per cent. of the Company's voting share capital and, in such circumstances, any further increase in the number of New Ordinary Shares will be subject to Rule 9 of the Code.

The Amryt Concert Party and other non-independent parties will not vote on the Waiver Resolution.

   18.    Change of accounting reference date 

It has been resolved to change the Company's accounting reference date to 31 December, conditional on Admission. As such, the first full reporting period of the Enlarged Group will be for the period ending 31 December 2015.

   19.    Change of name 

Subject to the Shareholders' approval by way of a special resolution, it is proposed, pursuant to Resolution 7, that the name of the Company be changed to Amryt Pharma Plc shortly after the General Meeting. If Resolution 7 to approve the change of name of the Company is passed at the General Meeting, the Company's AIM symbol will be changed to AMYT, its ESM symbol to AYP and its website address will be changed to www.amrytpharma.com as soon as possible. Resolution 7 is conditional on Shareholder approval of the Acquisition.

   20.    General Meeting 

Contained within the Admission Document is a notice convening the General Meeting to be held at noon at London Conrad St James, 2228 Broadway, London SW1H OBH on 18 April 2016, for the purposes of considering and, if thought fit, passing the Resolutions. A summary of the Resolutions is as follows:

-- Resolution 1 is an ordinary resolution to approve the Acquisition for the purposes of the AIM Rules, ESM Rules and section 190 of the Act, subject to the passing of resolution 2.

-- Resolution 2 is the Waiver Resolution described in paragraph 17 above. It is an ordinary resolution which is conditional on the passing of resolution 1 which will be taken on a poll of the Independent Shareholders to approve the waiver of the requirement contained in Rule 9 of the City Code for the Amryt Concert Party to make a general offer to Shareholders as a result of the Acquisition.

-- Resolution 3 is an ordinary resolution to approve, subject to the passing of resolutions 1 and 2, the consolidation of every 8 Existing Ordinary Shares into one ordinary share of GBP0.304 each, and the subsequent subdivision of each ordinary share of GBP0.304 each into 1 New Ordinary Share and 1 Deferred Share, as described in paragraph 13 above.

-- Resolution 4 is an ordinary resolution to authorise, subject to the passing of resolutions 1, 2 and 3 and conditional on the Placing Agreement becoming unconditional save for Admission, the Directors under section 551 of the Act to allot equity securities up to an aggregate nominal amount of (i) GBP1,234,950.96 for the issue of the Consideration Shares; (ii) GBP416,734.02 for the issue of the Placing Shares; (iii) GBP208,366.96 for the issue of the Placing Warrants; (iv) GBP20,732.55 for the issue of the Warrants; (v) GBP416,679.26 otherwise following Admission; and (vi) GBP416,679.26 in connection with an offer by way of rights issue. The Company does not intend to allot any shares by way of rights issue at this time but is seeking this authorisation in order to overcome any legal or practical problems which might arise relating to matters such as fractional entitlement or the laws of other territories in the event of such an issue. The Company is proposing to raise the amount set out in paragraph 12 above in respect of the Placing Shares, which the New Board intends to utilise for the purposes set out in paragraph 12 above.

-- Resolution 5 is an ordinary resolution to approve, subject to the passing of resolutions 1 and 2, the adoption by the Company of the new share option plan.

-- Resolution 6 is a special resolution to approve, subject to the passing of resolutions 1, 2, 3 and 4, the disapplication of statutory pre-emption provisions to allot equity securities for cash other than on a non pre emptive basis (i) in connection with an offer by way of rights issue; (ii) up to an aggregate nominal amount of GBP1,234,950.96 in connection with the issue of the Consideration Shares; (iii) up to an aggregate nominal amount of GBP416,734.02 in connection with the Placing; (iv) up to an aggregate nominal amount of GBP208,366.95 pursuant to the issue of the Placing Warrants; (v) up to an aggregate nominal amount of GBP20,732.55 pursuant to the issue of the Warrants; and (vi) up to an aggregate nominal amount of GBP208,339.63 otherwise following Admission.

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-- Resolution 7 is a special resolution to approve, subject to the passing of resolutions 1 and 2, the change of the name of the Company to "Amryt Pharma plc".

-- Resolution 8 is a special resolution to approve, subject to the passing of resolutions 1, 2 and 3, the amendments to the Company's articles of association to, inter alia, set out the rights attached to the Deferred Shares and to remove provisions which applied where the Company was not subject to the Code.

The attention of Shareholders is also drawn to the recommendations by and voting intentions of the Directors as set out in paragraph 23 below.

   21.    Irrevocable undertakings to approve the Proposals 

The Independent Directors have irrevocably undertaken to vote in favour of the Resolutions to be proposed at the GM, in respect of their and their associated companies' holdings totalling 4,283,779 Existing Ordinary Shares in aggregate, which represent approximately 1.24 per cent. of the Existing Ordinary Shares.

In addition, Cathal Friel has irrevocably undertaken to vote in favour of the Resolutions (other than the Waiver Resolution on which he is prohibited from voting), at the GM, in respect of his holdings (including for these purposes the holdings of Raglan Capital which he owns, together with his wife, Pamela Iyer) totalling 39,751,525 Existing Ordinary Shares in aggregate, which represent approximately 11.51 per cent. of the Existing Ordinary Shares.

   22.    Action to be taken 

A Form of Proxy is enclosed for use by Shareholders at the GM. Shareholders are asked to complete, sign and return the Form of Proxy to the Company's Registrars, Capita Asset Services, at PXS, 34 Beckenham Road, Beckenham, Kent, BR3 4TU, as soon as possible but in any event so as to arrive no later than noon on 14 April 2016, being two business days before the time appointed for the holding of the General Meeting. The completion and return of a Form of Proxy will not preclude Shareholders from attending the GM and voting in person should they wish to do so. Accordingly, whether or not Shareholders intend to attend the GM they are urged to complete and return the Form of Proxy as soon as possible.

   23.    Recommendation 

The Independent Directors, who have been so advised by Shore Capital and Davy, consider that the Proposals are fair and reasonable and in the best interests of the Independent Shareholders and the Company as a whole. Furthermore the Independent Directors, who have been so advised by Shore Capital, consider that the Waiver is fair and reasonable and in the best interests of the Independent Shareholders and the Company as a whole. In providing advice to the Independent Directors, Shore Capital has taken into account the Independent Directors' commercial assessment.

Accordingly, the Independent Directors recommend that Shareholders vote in favour of the Resolutions (other than the Waiver Resolution) to be proposed at the General Meeting, as they have irrevocably undertaken to do in respect of their own beneficial holdings of 4,283,779 Existing Ordinary Shares, representing 1.24 per cent. of the Company's issued share capital. Furthermore the Independent Directors recommend that Independent Shareholders vote in favour of the Waiver Resolution. Accordingly, the Independent Directors unanimously recommend that Shareholders approve the Resolutions by signing and returning the Form of Proxy to the Company's Registrars.

-Ends-

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