Invitrogen Corp. signed a definitive agreement to acquire privately held antibody manufacturer Zymed Laboratories Inc. in a $60 million cash transaction.

Zymed, of South San Francisco, produces pathology products, cancer and cell biology reagents and biomarkers, as well as general immunochemical reagents for the research and diagnostics markets. Its collection of more than 2,000 antibodies and related products complement Invitrogen's business in the areas of proteomics, stem cell research, fluorescent labels and probes, and RNAi reagents, said Cheri Walker, Invitrogen's vice president of corporate development.

"We bought them for their antibody capabilities," she told BioWorld Today. "They have some of the highest quality antibodies and a good reputation. But we also do see a possibility of an upside from the CISH test."

CISH stands for Chromogenic In-Situ Hybridization, which is a Zymed application used for patient stratification in clinical trials. It is a disruptive technology that uses SPT DNA probes and immunodetection chemistry to allow for the simultaneous evaluation of tissue morphology and gene status or chromosomal aberrations using brightfield microscopy.

The $60 million purchase price of Zymed takes into account that the company is expected to generate sales of about $15 million in the year following the closing of the acquisition.

"It's four times the forward revenue multiples," Walker said. "We just think that it's so synergistic to our business that we can really ramp up revenues."

Invitrogen expects the acquisition to be neutral to 2005 pro-forma earnings per share, and 4 cents accretive in 2006.

Zymed's research reagents focus on cell-signaling pathways with well-characterized primary antibodies, tissue arrays and protein arrays. Like Invitrogen, the company's goal has been to aid researchers in their discovery and development efforts.

While Carlsbad, Calif.-based Invitrogen has its own custom antibody business in San Diego, it plans to make Zymed's facility the primary site for its antibody production and distribution.

"These are new capabilities for us," Walker said. "We plan to add other technologies and really expand the antibody business."

Monoclonal antibodies are mass-produced from a clone and recognize only one antigen. They are made by fusing a normally short-lived, antibody-producing B cell to a fast-growing cell, such as a cancer cell. The hybrid cell, or hybridoma, multiplies, creating a clone that produces large quantities of the antibody.

Greg Lucier, Invitrogen's chairman and CEO, said that acquiring Zymed helps his company become the primary technology supplier for disease research and drug development.

"This high-quality collection of antibodies," he said, "enables us to create new systems that align with the way scientists are using technologies to discover drug leads and produce next-generation therapies."

Aside from its production capabilities, Zymed will bring to Invitrogen platforms such as CISH, as well as a full staff of 88 employees, including its president and CEO, Dean Tsao, who helped found the company in 1979.

"At this time we are planning to keep all of the employees and expand the research and development and sales support," Walker said.

Founded in 1987, Invitrogen employs 4,000 people and focuses on functional genomics, proteomics, bioinformatics and cell biology. It has products in major laboratories throughout the world.

In October, Invitrogen bought Kent, UK-based DNA Research Innovations Ltd. for $35 million in cash and up to $30 million more in research and development milestones. That acquisition brought the company a method for purifying DNA and other nucleic acids, including a line of kits already on the market. (See BioWorld Today, Oct. 29, 2004.)

Invitrogen's stock (NASDAQ:IVGN) rose $2.33 on Monday to close at $66.81.

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