A Diagnostics & Imaging Week

Caliper Life Sciences (Hopkinton, Massachusetts) reported that it has entered an agreement to acquire NovaScreen Biosciences (Hanover, Maryland), a privately held life science services company that provides screening, profiling and assay development services for pharmaceutical and biotech companies worldwide, and for government agencies such as the National Institutes of Health (Bethesda, Maryland).

Caliper will purchase NovaScreen for $22 million, subject to adjustment based on certain financial parameters, plus payments of up to $8 million contingent on the achievement of defined revenue milestones over a 30-month period. The consideration will be paid 80% in Caliper common stock and 20% in cash.

Based on an anticipated transaction close during 4Q05, the company expects the NovaScreen business to contribute positive earnings, positive cash flow and approximately $2 million to Caliper’s revenue. The acquisition also is expected to accelerate the company’s revenue growth.

By acquiring NovaScreen, Caliper said it would become a central resource for drug discovery solutions, offering scientists “a comprehensive suite of in-house and outsourced drug discovery technologies, products and services.”

“Through this acquisition we see significant opportunities to leverage Caliper’s and NovaScreen’s combined expertise and technologies to better serve the pharmaceutical industry – with immediate opportunities in the growing secondary screening and profiling market,” said Kevin Hrusovsky, president and CEO of Caliper.

“For example, our LabChip screening platform, which has been adopted by 75% of the top 15 pharmaceutical companies, is emerging as the gold standard for data quality and is ideal for kinase profiling. NovaScreen’s safety profiling services are also highly regarded throughout the industry, and we are optimistic that combining our LabChip, liquid handling and robotics technologies with NovaScreen’s service expertise will enable us to expand and accelerate adoption of our products and technologies as well as play a leading role in the high-growth kinase-screening market.”

Caliper uses its liquid handling and LabChip technologies to create tools that accelerate drug discovery, enable diagnosis of disease and facilitate scientific research.

In other dealmaking activity:

• RoseStreet Labs (Phoenix), an emerging wireless sensor company, reported the acquisition of breath acetone-monitoring technology from Dow Chemical (Midland, Michigan).

The technology, which provides rapid feedback of dietary and metabolic conditions, will be incorporated into RoseStreet’s LifeStyle Monitor for dietary and obesity biofeedback control. The acquisition includes both a working prototype and an extensive portfolio of intellectual property for acetone breath monitoring of fat metabolism, developed by Dow over the past four years.

Financial terms were not disclosed.

The company said the Dow-developed technology would accelerate the development of the monitor, which will provide consumers with an over-the-counter, low-cost solution for individual weight control by keeping track of acetone levels in the breath. Acetone breath levels are strongly correlated with fat metabolism, are independent of water retention or water loss, and are sensitive to exercise regimens.

The monitor is being designed to provide individuals with robust feedback on their body’s fat metabolism to aid in their weight control efforts.

The company said it expects to launch the monitor in 2006 as a lifestyle aid, and also plans on clinical versions by 2008.

“We are very pleased to have the opportunity to accelerate our LifeStyle Monitor product development with Dow’s outstanding technology, including advancements in proprietary enzyme technology,” said Bob Forcier, president and CEO of RoseStreet.

RoseStreet is a supplier of products and services for wireless infrastructure and sensors in the life sciences, renewable energy and homeland security markets.

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