A Diagnostics & Imaging Week
Qiagen (Venlo, the Netherlands) reported that it completed its exchange offer for all outstanding shares of Digene (Gaithersburg, Maryland) in its $1.6 billion acquisition of that company.
The exchange offer expired at 11:59 p.m., EST, July 20. At the time the exchange offer closed, 23,270,298 shares, representing about 94.6%, of Digene’s outstanding common stock, had been tendered.
Digene stockholders elected to receive Qiagen ordinary shares in exchange for about 90% of the Digene shares tendered, and therefore proration of Digene common stock elections will be required. Qiagen will disclose the proration calculations when completed on or before Aug. 2.
Qiagen, one of the world’s largest providers of molecular diagnostics products reported that it was acquiring Diegne, whose flagship product is a test for the detection of human papillomavirus (HPV), back in June after a decade long collaboration between the two companies.
Roche (Basel, Switzerland) reported that it has extended its hostile bid to acquire all of the outstanding shares of Ventana Medical Systems (Tucson, Arizona), a developer of tissue-based cancer diagnostics for $3 billion in cash, even though that company’s board rejected the offer, calling it “inadequate.”
Roche extended the tender offer to 5 p.m., EST, Aug. 23. The offer was previously scheduled to expire at midnight, EST, July 26.
As of the close of business on July 25, Roche said that only about 9,936 shares have been tendered pursuant to the offer.
In response, Ventana issued a statement saying that the situation “has not changed – our board of directors continues to believe that Roche’s bid is wholly inadequate and recommends that stockholders not tender any of their shares to Roche. Not only is the offer significantly below our current market price, it does not even come close to reflecting the intrinsic value of the company, its strong growth prospects in an accelerating market, and the synergy value of Ventana to Roche.”
Roche, which initiated its tender offer in June, said its $75 per share cash price represented a 44% premium to Ventana’s close of $51.95 on June 22 (the last trading day prior to the announcement of Roche’s offer) and a 55% premium to its three-month average as of the same date of $48.30.
In other dealmaking news:
Biofield (King of Prussia, Pennsylvania) reported signing a license agreement granting the MacKay Group Limited (MKG; Hong Kong) an exclusive, sub-licensable royalty-bearing license to distribute, manufacture, develop and commercialize Biofield’s breast cancer technology worldwide.
MKG assumes from Biofield the responsibility and expense to market, manufacture, further develop and commercialize the technology. In addition, MKG assumes from Biofield the sole responsibility and expense to secure additional regulatory approvals and to conduct additional clinical trials and R&D. MKG will further make “commercially reasonable” efforts to further develop the technology for screening, as opposed to purely diagnostic, purposes and for cancers other than breast cancer.
MKG will pay Biofield royalties based on gross receipts received by MKG and its affiliates in connection with Biofield’s technology: 10% of gross receipts up to S$100 million; 7.5% of gross receipts from $100,000,001 to $200 million; and 5% of gross receipts over $200 million.
MKG must pay minimum royalties of $3 million a year beginning 12 months after regulatory approval in China and the first commercial sale of the next prototype of the Biofield diagnostic device in China. The initial $3 million minimal royalty payment shall increase to $6 million per year one year after the China launch date and shall thereafter increase by 10% each year for all subsequent years of the agreement.
IMKG also will pay Biofield $1 million in licensing fees, $150,000 of which MKG already paid in connection with the agreement, the balance to be paid upon the China launch date.
The term of the agreement is 10 years with automatic renewals for additional 10 year terms unless terminated by one of the parties.
Biofield said it will use the $150,000 received from MKG to help complete required financial audits and SEC filings, to complete the regulatory audits of its new office in King of Prussia, Pennsylvania, and to further the development of the new generation device. Previously, MKG advanced $75,000 to Biofield to, among other things, engage new auditors and securities counsel to help bring Biofield’s regulatory filings current, to move the contents of Biofield’s former facility in Alpharetta, Georgia to its new King of Prussia office, and to set up demonstrations in China, the Philippines, and Mexico. Biofield develops non-invasive diagnostic medical devices to assist in detecting breast cancer.