A Diagnostics & Imaging Week
Nanogen (San Diego) reported that it has completed the purchase of the rapid cardiac immunoassay test business of Spectral Diagnostics (Toronto) for C$9 million. Payment was comprised of C$5.65 million in cash and C$3.35 million in Nanogen common shares.
The deal, first unveiled in December (Medical Device Daily, Dec. 21, 2005), expands Nanogen's portfolio of diagnostics to include Spectral's Cardiac STATus and Decision Point product lines, the i-Lynx reader, related intellectual property and manufacturing capabilities.
Nanogen said it now has a fully integrated point-of-care (POC) group with capabilities in research, product development, manufacturing, and sales and marketing, with a worldwide distribution network to compete in the $1.5 billion worldwide POC market.
Spectral reported nearly C$7 million in product revenues during 2005 from the Cardiac STATus tests and i-Lynx readers. The Cardiac STATus line includes four FDA-cleared tests that can be used at the point of care to determine elevations of cardiac markers, providing an aid to physicians to assess and diagnose acute coronary syndrome as indicated by chest pain.
About 50 employees from Spectral will join Nanogen, including David Ray, former chief operating officer of Spectral.
Spectral said that with the sale it now would focus on its sepsis and infectious disease tests. CEO Paul Walker, MD, PhD, said, "We will have sustainability through our royalty and reagent revenues, and growth both from our existing products and from other potential opportunities facilitated by our strengthened balance sheet."
Spectral retains intellectual property and revenues related to its single-chain Troponin I calibrator, as well as other reagents. This retained reagent business accounts for about C$3 million in annual revenue.
"Spectral has retained the key personnel, capabilities and equipment to manufacture its remaining products, support the development of new products, manage ongoing clinical development, and continue new business development," Walker said. "Today, we are a leaner company, adequately funded for our planned operations, and focused on rapidly delivering shareholder value."
Spectral's major retained product lines include the Endotoxin Activity Assay, which the company bills as "the first FDA-approved diagnostic test for sepsis." Sepsis kills about 750,000 people in the U.S. each year and accounts for more than $17 billion in annual healthcare costs.
Spectral also retains its West Nile Virus Assay, as the flagship product in its infectious disease-testing portfolio. The assay received approval from Health Canada in late 2005. Spectral is currently pursuing regulatory approval for the U.S. market for the coming summer season. West Nile virus is a mosquito-borne pathogen that represents a major emerging public health threat in North America and has been responsible for nearly 1,000 deaths.
David Ludvigson, president and chief operating officer of Spectral, said the company's POC group "will continue to focus on FDA approval of a quantitative congestive heart failure diagnostic test and the development and launch of other complementary tests. We plan to leverage the existing customer network, the acquired manufacturing capability and the other products in our development pipeline to build market share."
In other dealmaking news:
• Instant Technologies (IT; Norfolk, Virginia) reported that it has acquired Accu-Stat Diagnostics (Lake For-est, California) for an undisclosed sum.
Accu-Stat recently obtained FDA 510(k) clearances to sell its Accu-Stat line of home testing products for drugs of abuse, breath alcohol, cholesterol, and fecal occult blood tests over-the-counter.
"The acquisition of Accu-Stat is strategic to the advancement of [our] goal to expand our product portfolio and enter the consumer products market," said Jeff Konecke, IT's director of business development. "The OTC market for drugs of abuse is poised for growth and is in need of a strong market leader, which we intend to become."
Instant Technologies is a developer of rapid test devices that include drug and alcohol testing, women's health and clinical diagnostics.
• Escalon Medical (Wayne, Pennsylvania) reported that its subsidiary, Escalon Digital Vision, trading as Escalon Medical Imaging (EMI), has completed its previously reported purchase of the assets of MRP Group (Lawrence, Massachusetts), a private ophthalmic technology provider. The purchase price included 250,000 shares of Escalon common stock and about $50,000 in cash.
MRP's products include retinal and slit lamp digital imaging systems, OphthaVision image management software and fundus camera power supplies. The retinal imaging systems consist of a two-camera configuration providing high sensitivity and resolution when performing eye tests such as fluorescein angiography and color retinal photography, the company said.
Richard DePiano, Escalon CEO and chairman, said, "We are confident that the integration of MRP Group's retinal imaging systems with EMI's existing ophthalmic photography product portfolio will position us to secure a leadership role in ophthalmic digital imaging and build a solid foundation for future long-term growth."
Matthew Carnevale, MRP's founder, will serve as executive vice president of Escalon Digital Vision, which will be a subsidiary of Escalon Medial.
Escalon develops ophthalmic diagnostic, surgical and pharmaceutical products and vascular access devices. Drew (London), a separate division, provides instrumentation and consumables for the diagnosis and monitoring of disorders in the areas of diabetes, cardiovascular diseases and hematology.
Escalon has manufacturing operations in Long Island, New York; New Berlin, Wisconsin; Dallas; Oxford, Connecticut; and Barrow-in-Furness, UK.
• Pacific Mobile Diagnostics (PMD; Phoenix) reported acquiring Remote Access Diagnostic Radiography (RADR; Bloomfield, Colorado). Terms were not disclosed.
PMD recently was spun off from SunAlliance Health-care Services, a national healthcare services provider in a management buyout led by SunAlliance Vice President Rick Baker. Both firms provide mobile radiography, EKG and ultrasound services to long-term care patients and corrections facilities.
Baker, president of the newly independent company, said, "[O]ur strategy is to be the leader in mobile [in Colorado]. This combination with RADR, which has an all-digital approach … is the right move at the right time."
The companies will operate in long-term care, skilled nursing and correctional facilities in Arizona and Colorado. Operations at PMD have begun the transformation to digital radiography, and RADR was the first all-digital provider in Colorado.