Cancer
Genetics Inc. Completes Acquisition of BioServe India
Cancer Genetics, Inc.
(Nasdaq; CGIX), an emerging leader in DNA-based cancer diagnostics, closed the
announced acquisition of BioServe Biotechnologies (India) Pvt. Ltd., a premier
genomics services provider serving both the research and clinical markets in
India.
BioServe India, which
operates out of a 14,000-square-foot, state-of-the-art genomics facility in
Hyderabad, has serviced over 200 clients with best-in-class genomic services,
including next-generation sequencing, genotyping and DNA synthesis. CGI will benefit
from immediate revenue through BioServe India's long-term contracts with
academic and research institutions and its capabilities in genetic research,
test development and genomic analysis.
BioServe India's clients
include some of the leaders in the Indian life sciences industry, including Dr.
Reddy's Laboratories, NATCO Pharmaceuticals, Piramal Life Sciences, the Indian
Institute of Science Education and Research and the Centre for Cellular and
Molecular Biology.
"We are excited to be
joining Cancer Genetics," said Venkatadri Bobba, general partner of
Ventureast, India's premier venture capital fund and a board member at BioServe
India. "This merger will allow us to improve patient care in India by
delivering cutting-edge, patented cancer diagnostic technologies and allow us
to offer an even broader range of state-of-the-art services to biopharma
customers, hospitals and academic research institutions."
India is recognized as a
high-growth market for molecular diagnostics and oncology services. More than 1
million new cases of cancer are diagnosed in India each year, and incidence
rates are expected to rise by more than 72 percent by 2025. Additionally,
according to Frost and Sullivan, healthcare spending is expected to increase at
an average annual rate of 17 percent, reaching $160 billion by 2017.
CGI's CEO, Panna Sharma,
said the acquisition places the company in a unique position to meet the
growing need for genomic-based cancer diagnostics in this market. He
anticipates wide adoption of CGI's proprietary tests for non-Hodgkins lymphomas
and leukemias, kidney cancer and cervical cancer. In particular, the
acquisition positions CGI to revolutionize cervical cancer screening and
treatment in India, where 123,000 new cases are diagnosed annually, he said.
"We now have a
growing pipeline of potential clients and collaborators for our non-invasive
cervical cancer test in India, where cervical cancer is the leading cause of
cancer death in women, accounting for 25 percent of global cervical cancer deaths,"
Sharma said. "FHACT® will provide physicians in India with critical
genomic information to provide improved screening for cervical cancer in both
urban and rural settings."
The expansion into India
will also allow CGI to leverage its resources and scale its operations, while
strengthening its capabilities in molecular testing, DNA synthesis, biomarker
analysis and next-generation sequencing, Sharma said. He described the
Hyderabad laboratory as an important resource that will allow CGI to access high-growth
markets for oncology diagnostics and reduce costs associated with product
manufacturing, test development and genomic data analysis.
CGI acquired BioServe
India for approximately $1.9 million, largely in CGIX stock and other deferred
consideration. Under the terms of the agreement, BioServe India will be a
wholly owned subsidiary of CGI that will be renamed Cancer Genetics India. CGI
plans on retaining BioServe India's 33 employees, and expanding and
strengthening the team.
"This acquisition is
an important milestone for CGI, as we now have the clinical diagnostics
infrastructure and resources to deliver critical genomic oncology services at a
time when India has placed a high priority on expanding its healthcare
capabilities," Sharma said.
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