A Medical Device Daily
Illumina (San Diego) reported that it has signed a definitive agreement and plan of merger with privately held CyVera (Wallingford, Connecticut) pursuant to which CyVera will become a wholly owned subsidiary of Illumina.
The total consideration for the transaction is $17.5 million, consisting of about 1.5 million shares of Illumina common stock and the payment of about $2.3 million of CyVera's liabilities at the closing. The exact number of shares will be based on the average price of Illumina's outstanding shares before closing, subject to a 10% collar around the 10-day average price for the shares on the date of the agreement.
Illumina also will assume outstanding stock options at an exchange ratio determined by the closing price.
According to Illumina, CyVera's digital-microbead platform is “highly complementary“ to its portfolio of products and services and upon closing of the transaction will become an integral part of the company's BeadArray technology.
The acquisition will provide Illumina with a comprehensive approach to bead-based assays for biomarker R&D and in vitro and molecular diagnostic opportunities, including those that require low-complexity as well as high-complexity testing.
As a result, Illumina said it intends to expand its activities to seek diagnostic collaborators and partners.
The closing is subject to customary conditions and is expected to be completed by the end of March.
Jay Flatley, Illumina president and CEO, said, “CyVera's emerging product line will complement our current offerings and give Illumina's BeadArray solutions even more flexibility as we extend our performance and value proposition into the clinical research and diagnostics markets. At the same time, we can leverage our core assay and oligo synthesis technologies to sustain our manufacturing cost leadership position. It's a great strategic fit.“
Alan Kersey, president and CEO of CyVera, said, “Illumina's growing portfolio of assays and content will allow our team in Connecticut to focus on development of the bead manufacturing capability and the Virtual Cytometer system. In addition, we will be able to utilize Illumina's direct sales and marketing organization to bring products to the research market as well as forging strong partnerships with third-party companies in both research and diagnostics fields.“
A venture-backed company spun out of CiDRA (also Wallingford) in late-2003 (Medical Device Daily, Dec. 22, 2003), CyVera is developing a bead technology that utilizes a holographic imprinting approach to add a digital address to rod-shaped beads, each of which is a potential site for a biological assay. Like Illumina's beads, CyVera beads can support both nucleic acid and protein probe content.
That bead technology is being developed with the in-tent of enabling easy assay customization, high sample throughput, reliable performance and low manufacturing costs, the companies said. The technology is expected to provide high-performance assay capability at multiplex levels between 10 and 1,000 targets, particularly when combined with Illumina's GoldenGate, Infinium, DASL and emerging protein assay protocols.
CyVera also has developed a Virtual Cytometer scanning system for its digital bead technology, allowing the transfer of microbeads from standard microtiter plate formats to a cell where they self-align into randomly ordered arrays for readout. Depending on the multiplex level, up to 120 samples per hour can be assayed on the system. This system is being designed to be compatible with liquid-handling automation and informatics infrastructures found in high-throughput diagnostic laboratories.
CyVera's detection systems and bead technology will be integrated with Illumina's growing assay and microarray product portfolio, which consists currently of multi-sample Sentrix microarray solutions with the capability of analyzing 384 to more than 200,000 targets per sample in gene expression and genotyping applications.
The integration of CyVera will extend further the capability of BeadArray technology and enable Illumina to more effectively address the emerging biomarker R&D and in vitro and molecular diagnostics markets.
The first products based on the CyVera technology are expected to be available in the second half of 2006.
Encore Medical (Austin, Texas) said it has completed the acquisition of substantially all of the assets of Osteoimplant Technology (OTI; Baltimore). Those assets include a complete line of spinal implant products featuring a Multi Axial Positioning System for spinal fixation and several total knee and hip implant designs, including a Zweymuller-type femoral hip stem.
The transaction, which was announced early this month (Medical Device Daily, Feb. 4, 2005), closed on Tuesday, with consideration paid by Encore consisting of about $14.5 million in cash, which was to be distributed to OTI's creditors and shareholders.
There also are up to $1.5 million in future milestone payments that could be earned by OTI based on the performance of the products being acquired during the first 12 months from the closing.
Encore said it expects the acquisition to be break-even on an earnings per share basis in 2005 and accretive in 2006 and thereafter. It financed the purchase using its revolving line of credit.
Encore Medical is a diversified orthopedic device company that develops, manufactures and distributes a comprehensive line of orthopedic devices, including surgical implants, sports medicine equipment and products for orthopedic rehabilitation, pain management and physical therapy.
LehmanMillet (Boston), the nation's leading U.S. marketing services firm focused exclusively on the medical device and diagnostic industry, has joined forces with BLVDwest (Newport Beach, California) and formed a new agency, LehmanMillet West.
Terms of the agreement were not disclosed.
The new agency is operational immediately and will be providing the full array of integrated services for marketing communications, including strategic planning; positioning, branding and messaging; creative and strategic platform development; advertising and promotion; and public and professional relations.
Both LehmanMillet and the new LehmanMillet West are a part of HealthSTAR Communications, the leading privately owned marketing communications network in the world.
LehmanMillet has long sought a West Coast office to meet the needs of its clients west of the Rockies. “We found BLVDwest to be extremely well matched to our approach in terms of their strategic focus and strong creative,“ said Bruce Lehman, who will serve as president of LehmanMillet West and LehmanMillet. “We worked together for about a year to make sure this was the best move for everyone. We have seen tremendous support from existing clients, as well as new clients who are interested in what the new LehmanMillet West has to offer.“
The new firm will retain the same management team that guided BLVDwest, including Tim Friday, president of BLVDwest who now is senior vice president, medical communications, for LehmanMillet West; Stacey Howmann, senior vice president, client service; Clay Daniells, senior vice president, creative; and Mike Ritchey, senior vice president, business development.
Lehman noted that most large medical marketing services agencies in the U.S. specialize in pharmaceutical products. But, he noted, the device and diagnostic marketplace is “very different,“ adding that these differences present “uniquely demanding challenges to device and diagnostic marketers looking to maximize their opportunities.“
He pointed out that device and diagnostic products “don't have the patent protection that drugs do; product lifecycles often last less than two years.“ Lehman said, “When you think that in that time frame they have to launch a product, stimulate adoption, and leverage early success into a significant market share, you can see why they need an agency that knows their business and can move quickly to meet their needs.“
In other deal-making news:
• MIV Therapeutics (Vancouver, British Columbia) and SagaX Medical Technologies (Herzliya, Israel) reported entering into a letter of intent regarding the acquisition of SagaX's next-generation embolic-protection technology for stroke patients.
The parties said they hope to negotiate and execute definitive agreements regarding the transaction “within the next few weeks.“
Led by Dr. Dov Shimon, SagaX is developing a filter with stent in the aorta to prevent stroke from emboli.
“MIVT looks forward to working with SagaX to conclude this agreement and making this new technology available to medical practitioners in many major world markets,“ said Alan Lindsay, MIV Therapeutics president and CEO. “With the addition of this technology, MIVT will be favorably poised to enter the field of endovascular/interventional products, which include advanced neuro-interventional clinical applications. The MIVT technology portfolio will be further enriched by the acquisition of related intellectual property developed by SagaX.“
MIVT is developing a next-generation line of advanced biocompatible coatings for passive and drug-eluting application on cardiovascular stents and other implantable medical devices. Its ultra-thin coating has been derived from a biocompatible material called Hydroxyapatite (HAp), which has been shown to significantly inhibit the body's inflammatory response and the problem of restenosis associated with implanted medical devices. Hydroxyapatite is a biocompatible, porous material that makes up the bone mineral and the matrix of teeth. It is widely used as a bone substitute material and for coating implantable fixation devices in orthopedic, dental and other applications.
A collaborative research agreement between MIVT and the University of British Columbia (also Vancouver) received a research and development grant from the Natural Sciences and Engineering Research Council of Canada in 2002 for the additional development of Hydroxyapatite as a drug-eluting coating.
• Serologicals (Atlanta) said that its Chemicon International (Temecula, California) subsidiary has acquired the assets of Specialty Media (Phillipsburg, New Jersey).
Specialty Media, a division of Cell & Molecular Technologies, owned by Sentigen Holding, develops and suplies a variety of specialty stem cell culture media formulations and supplements, cells and research reagent tools to the life sciences industry.
The acquisition was for $6.5 million in cash.
Jeffrey Linton, president of Chemicon International, said, “The Specialty Media acquisition represents another achievement in the execution of our strategic plan to continue to be the premier provider of tools for stem cell research. This transaction, which we expect to be immediately accretive, will provide us an expanded platform on which to continue to add new stem cell product opportunities to address the needs of the stem cell research market. We expect to generate approximately $4 million from the sale of Specialty Media's products in 2005.“
• Diabetic Treatment Centers of America (Salt Lake City) reported the execution of a letter of intent to acquire Movement Disorder Technologies (MDT).
Arden Oliphant, CEO of Diabetic Treatment Centers of America, said, “MDT has an outstanding team that has a proven history of developing significant medical devices.“
He added: “Providing neurologists with technology that will assist in the treatment of Parkinson's disease, essential tremor and Tourette's syndrome will dramatically increase the size of the market for Diabetic Treatment Centers of America.“
Carl Doane, executive vice president of MDT, said, “We look forward to working with Diabetic Treatment Centers of America to leverage our technologies and provide a means to better health to those who suffer with movement disorders.“
The letter of intent, which was executed by both parties, provides for the negotiation of the final terms, is non-binding and subject to the completion of due diligence.