A week after agreeing to buy Labopharm, Paladin Labs' bid to acquire another Canadian drugmaker, Afexa Life Sciences, has been hit by the latter board's confirmation that it unanimously rejects an offer made on August 10.

Paladin, which already owns almost 15% of Afexa, had offered C$0.55 per share for the stock it does not already own. This values the latter firm at around C$56.7 million and Paladin noted that it represented a premium of 16% over the closing price of Afexa shares on August 9 and up 57% compared to July 14. That was the last trading day before it bought more stock in the Edmonton-based firm, which is best-known for Cold-FX, Canada's leading over-the-counter cold and flu remedy.

However, Afexa's directors are not impressed and asked shareholders to reject the offer. Chairman William White said the Paladin offer is "inadequate even to reflect the value of our marquee product [Cold-Fx] and gives little to no value of our growth opportunities through new products and new markets".

Afexa added that the Paladin offer "gives little to no value" to Cold-FX's new formulations and planned entry into new markets including China, Japan and the USA. It also highlights a pipeline that includes candidates for cholesterol reduction, supportive care for chronic lymphocytic leukaemia, blood glucose management and seasonal allergy reduction.

The stance taken by Afexa is in stark contrast to the stance taken by the board at Labopharm last week which accepted Paladin's offer worth around C$20.4 million