Ivax Diagnostics (Miami) has reported that it is placing further development of its Parsec laboratory automation system on hold “indefinitely” and take a related charge of about $1.7 million. Ivax said it will focus instead on developing its new Mago 4 instrument, the upgraded version of its Mago Plus instrument.
Ivax also said that a recent decline in its market capitalization will cause it to take goodwill impairment charges of about $6.7 million related to two of its units, Delta Biologicals (Pomezia, Italy) and ImmunoVision (Springdale, Arkansas). It said that valuation process is not complete, so it is unable to provide an exact estimate of the impairment. As of June 30 the company said it had goodwill of roughly $6.7 million.
It said that the impairment charges associated with the Parsec and any goodwill are expected to be reflected in Ivax’s financials for the quarter ended Sept. 30 and not impact its cash position.
Ivax said that a consulting firm it had engaged to evaluate development of the Parsec system, concluded that it was unlikely to meet its target for submitting a 510(k) application to the FDA primarily as a result of the status of the operating system and other software components used in its development and operation.
The company said it then determined that the new Mago 4 instrument can be brought to market faster, using fewer resources and with less money than completing the Parsec development.
The Mago 4 is expected to be able to perform both ELISA and IFA techniques simultaneously, perform positive sample identification and use disposable pipette tips, the company said. It said that the Mago 4 will offer an enhanced automation solution to customers who prefer a more compact, lower-priced instrument with features and benefits similar to competing instruments
The company also said it will delay marketing its hepatitis test kits to be manufactured at its Italian facilities, in accordance with a technology license. As of June 30 Ivax said it had about $1.2 million of intangible assets and roughly $500,000 of accrued payables relating to the technology license.
Ivax makes diagnostic reagents, instrumentation, and software in the U.S. and Italy through its three subsidiaries: Diamedix (Miami), Delta and ImmunoVision.