$50M deal: ProPhase Labs, Inc. (NASDAQ:PRPH) Selling Cold-Eeze Brand, How Will Share Price Be Affected?

Diversified natural health science company, ProPhase Labs, Inc. (NASDAQ:PRPH), announces it has sold its Cold-Eeze brand to a subsidiary of Mylan N.V. for a price of $50 million.

ProPhase Labs Inc. has entered into an agreement to sell its Cold-Eeze cold remedy brand to a wholly owned subsidiary of Mylan N.V. for $50 million.

The Philadelphia Business Journals first reported the Doylestown company was exploring the potential sale of the product line in August.

Under the terms of the deal, Mylan (NASDAQ: MYL) will purchase substantially all of the company’s assets and other rights relating to the brand. The Cold-Eeze brand began as zinc lozenges used to shorten the duration of cold, but the formulations were later expanded to include “Gummies,” quick-melts and oral spray versions of the product.

ProPhase CEO Ted Karkus was not immediately available for comment on the proposed sale.

The deal, expected to close in the first quarter of 2017, is subject to approval of the company’s stockholders. The company’s executive officers and directors, which hold 24 percent of the company’s common stock, have entered into voting agreements supporting the sale.

While Cold-Eeze is ProPhase’s major product, the proposed sale does not mean the company is going out of business. ProPhase is retaining ownership of its manufacturing plant in Lebanon, Pennsylvania, and its Bucks County headquarters, as well as its dietary supplements product lines which are currently under development. As part of the transaction, the company — through its Pharmaloz subsidiary — will enter into a manufacturing and supply agreement with Mylan.

Prophase (NASDAQ: PRPH) was assisted in the deal by Bourne Partners, a boutique investment bank focused on the consumer health and pharmaceutical industries. The company is being represented by Herb Kozlov and Aron Izower, partners at the the law firm of Reed Smith.

DOYLESTOWN, PA–(Marketwired – January 09, 2017) – ProPhase Labs (PRPH) announced earlier today an agreement to sell its Cold-EEZE® cold remedy brand. A conference call will be held on January 10th, at 4:30pm EST. ProPhase Labs Chairman and CEO, Ted Karkus will provide a company overview of the agreement. There will be a question and answer session following initial remarks.

The conference call will be webcast live at:

https://engage.vevent.com/rt/prophaselabsinc_ao~49627472 at 4:30 PM (EDT) on Tuesday, January 10, 2017.

Participants wishing to ask questions may access the live call by dialing (844) 301-0501 conference ID # 49627472. A replay of the conference call will be available for 90 days on the company website www.ProPhaseLabs.com.

About ProPhase Labs

ProPhase Labs is a diversified natural health medical science company. It is a leading marketer of the Cold-EEZE® cold remedy brand as well as other cold and flu relief products. Cold-EEZE® cold remedy zinc gluconate lozenges are clinically proven to significantly reduce the duration of the common cold. Cold-EEZE® cold remedy customers include leading national chain, regional, specialty and local retail stores. ProPhase Labs has several wholly owned subsidiaries including a manufacturing unit, which consists of an FDA registered facility to manufacture Cold-EEZE® cold remedy lozenges and fulfill other contract manufacturing opportunities. For more information visit us at www.ProPhaseLabs.com.

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ProPhase Labs, Inc. (NASDAQ:PRPH) shares are trading +3.47% on the news and in the range of $2.09 – 2.45 during the current trading session.  When taking a look at which direction the stock might be headed, investors often look to brokerage analysts who cover the stock.  Sell-side research firms on Wall Street currently have a consensus one-year price target of $15.55 on the stock.  This is according to brokerage analysts polled by Thomson Reuters First Call.

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In looking at where the stock is trading on a technical level, the stock is trading +3.96% away from its 50-day moving average of $2.01.  Based on the most recent available data, the equity is -14.69% off of its 52-week high of $2.45 and +93.52% away from its 52-week low which is $1.08.

Today, the stock opened at $2.35 and the last bid at the time of writing stood at $2.09.  During the session thus far, the equity dipped down to $2.09 and touched $2.45 as the high point.  ProPhase Labs, Inc. (NASDAQ:PRPH) has a market cap of $35.70M and has seen an average daily volume of 6,075 over the past three months.

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