Novartis offers $470m to boost personalised cancer treatment
pharmafile | January 24, 2011 | News story | Research and Development, Sales and Marketing | Cancer, Genoptix, Novartis, cancer diagnostics, personalised medicine
Novartis has offered $470 million for a California-based laboratory whose diagnostic services it hopes will enhance personalised treatment.
Genoptix specialises in diagnosing cancers in bone marrow, blood and lymph nodes, and would be subsumed into Novartis Molecular Diagnostics (MDx) unit, part of Novartis’ pharma division, if the transaction goes through.
Genoptix’s offering provides a “strategic fit with the current portfolio of companion diagnostic programs within MDx”, according to Novartis.
“The acquisition of the Genoptix medical laboratory will serve as a strong foundation for our individualised treatment programmes,” said Novartis chief executive Joseph Jimenez.
Founded in 1999, Nasdaq-listed Genoptix employs around 500 people. In 2009, it had sales of $184 million, and $148 million for the first nine months of last year.
It is also currently the subject of a shareholder class action lawsuit in the US which alleges, among other complaints, that Genoptix directors have failed to disclose adverse information about the company’s ability to grow.
But Genoptix chief executive Tina S. Nova insisted the Novartis deal would provide “substantial value and liquidity to our stockholders”.
“We share Novartis’ strong commitment to transforming patient care, improving health outcomes for patients and enhancing the suite of diagnostic tools for our physician customers,” Nova added.
These customers include community-based haematologists and oncologists, the company says.
The Genoptix board of directors has unanimously recommended that shareholders should back the merger agreement and expects it to go through before July.
Novartis’ offer of $25 per share is 27% above Genoptix’s closing share price of $19.76 on January 21.
Last November, Novartis laid out a business strategy which would see it increase speciality and oncology products by 10% to three quarters of expected pharma sales in 2015.
Adam Hill
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