A Medical Device Daily

Sequenom (San Diego) said it intends to move forward with an exchange offer to acquire Exact Sciences (Marlborough, Massachusetts) in an all-stock transaction valued at $41 million, even though Exact reported earlier this week that its board has already rejected an acquisition proposal by Sequenom.

According to the offer, each share of Exact would be exchanged for $1.50 in Sequenom stock, subject to a floating exchange rate within a 15% collar, in which the price of Sequenom's common stock is between $20.74 and $28.06 a share.

Exact said earlier this week that is actively pursuing a strategic alternative that its board believes can provide a greater value to Exact and its shareholders than the Sequenom proposal (Medical Device Daily, Jan. 14, 2009).

"We are disappointed that the board of Exact Sciences has rejected our proposal. Unfortunately, the board of Exact Sciences has failed to recognize the potential value the combination of our two companies could provide to our respective shareholders," said Harry Stylli, PhD, president/CEO of Sequenom. "Based on the public statements of the EXACT board, we continue to be concerned that Exact may enter into transactions which may not be in the best interest of its shareholders. Therefore, in the event Exact Sciences enters into any material out-licensing agreement, collaboration or financial restructuring, we will immediately withdraw our offer."

Stylli added that the company has decided to move forward with this acquisition because Exact is "essentially a shell with intellectual property assets," and Sequenom expects it would be straightforward to assimilate the assets into its operations with minimal near-term cash outlay and execution risk to its current initiatives.

"Exact Sciences is facing multiple, significant business challenges, and we believe our proposal will address several of these including the risk of delisting from The Nasdaq Capital Market, uncertain prospects for future financing, the need for further restructuring and significant execution risk," Stylli said.

Sequenom said the acquisition of Exact, a developer of noninvasive stool-based DNA screening technologies for colorectal cancer, would provide the company with an expanded noninvasive diagnostics offering in oncology, and position it with one of the most comprehensive noninvasive cancer diagnostic portfolios.

In other dealmaking activity:

• Getinge AB (Stockholm, Sweden) said it will extend its previously reported $53 a share cash tender offer for all of the outstanding shares of Datascope (Montvale, New Jersey) until the end of Jan. 21. All other terms of the offer remain unchanged, the company noted.

The deal, which is valued at $865 million, was first reported in September (MDD, Sept. 17, 2008).

Getinge said that as of the close of business on Tuesday, about 15,007,487 shares of Datascope common stock, representing roughly 93% of the total outstanding shares of Datascope common stock, had been validly tendered and not withdrawn in the offer.

• ISO (Jersey City, New Jersey) said it has acquired D2Hawkeye (Waltham, Massachusetts), a provider of information solutions for the healthcare industry. Solutions from D2Hawkeye include advanced healthcare analytics, data mining, decision support, clinical quality analysis, and risk analysis tools. Financial terms were not disclosed.

• Medicity (Salt Lake City) and Novo Innovations (Alpharetta, Georgia) reported a merger, which it says combines two "market leaders" in health information exchange into a single, company that connects more than 1,800 healthcare organizations and 85,000 physicians across the nation.

The company will be known as Medicity and will maintain its headquarters in Salt Lake City, with offices throughout the U.S. including Novo's Alpharetta facility, which will serve as the focal point of East Coast operations.

• MedAvant Healthcare Solutions (Santa Ana, California), a healthcare technology and transaction services company, reported the acquisition of the Qwik+Cross Medicare crossover business of HDM (Omaha, Nebraska). MedAvant said the acquisition would provide its existing clients with greater pay connectivity and expedited billing to payers offering Medicare Supplemental Insurance. Financial terms were not disclosed.

• Henry Schein (Melville, New York), a provider of healthcare products and services to office-based practitioners, reported the acquisition of Medka (Berlin), a full-service provider of medical consumables, equipment and technical services primarily to physicians.

• IPC The Hospitalist Company (North Hollywood, California), a national hospitalist physician group practice company, said it has acquired the hospitalist practice of Midwest Acute Care Consultants (St. Louis).

• The Gemstar Group (Chicago) has agreed to acquire Calyx Partners (Longwood, Florida), a private healthcare-consulting firm. Financial terms were not disclosed.