Chugai Pharmaceutical Co. Ltd. has acquired a "sizable equity"stake in the Denver diagnostic company REAADS MedicalProducts Inc. The amount of the equity purchase was notdisclosed.
Under the investment deal announced last week, Chugai willdistribute REAADS' future and existing products in Japan, andthe two companies will jointly develop a series of diagnosticproducts for the Japanese market. Doug Simpson, REAADS' vicepresident and general manager, said the diagnostics to bedeveloped for the Japanese market are targeted to connectivetissue disease, rheumatoid arthritis and other immunologyproblems.
Founded in 1990, privately held REAADS currently marketsseven products, including lab tests for certain rheumatologyproblems and diagnostics for autoimmune diseases, specificallylupus and related disorders.
REAADS noted that Chugai's investment will be used to fundadditional product research and development in Denver.Simpson said REAADS turned to Chugai after discussions withColorado-based venture capital firms failed to result in a deal.The company's previous agreements with other companieshave been solely for product distribution.
REAADS said that following the deal with Chugai, a financialgroup in Japan expressed interest in investing in the company.
The company also said it is adding additional positionsthroughout the company, particularly in R&D and quality andregulatory affairs, and expects to double its total number ofemployees over the next two years.
REAADS is the second U.S. diagnostic company in which Chugaihas acquired a stake. The Japanese company acquired Gen-Probe Inc. of San Diego in 1989.
-- Brenda Sandburg News Editor
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