Invitae (NYSE: NVTA), a leading genetics and synthetic biology company, and ArcherDX, a leading genomics analysis company innovating in precision oncology, today announced the companies have entered into an agreement to combine.
The combined company aims to advance care for cancer patients by accelerating adoption of genetics . Integrating germline testing, tumor profiling and liquid biopsy technologies and services in a single platform will enable precision approaches from diagnostic testing to therapy optimization and monitoring, expanding access to personalized oncology.
“ArcherDX and Invitae share a foundational belief in the power of genomic information to impact care. We are thrilled to unite with Invitae to form the leading hub for precision oncology, diagnostics, therapy optimization and monitoring, with an opportunity to accelerate both patient care and shareholder value,” said Jason Myers, Ph.D., chief executive officer and co-founder of ArcherDX. “ArcherDX was founded to democratize precision oncology with best-in-class products that are personal, actionable and available in local care settings. We see STRATAFIDE DX
“Integrating all aspects of cancer genetics can transform care for patients and the flexibility that comes from both centralized and decentralized capabilities will uniquely position Invitae to meet the needs of customers worldwide,” continued Dr. George. “By joining together, we will unite world-class capabilities in the hands of a talented team with complementary expertise and strong brands in service of a shared goal to improve healthcare for patients.”
Uniting Invitae and ArcherDX will expand support for precision oncology.
- Invitae has quickly become a leader in diagnostic and hereditary risk testing and has strong relationships with clinicians caring for cancer patients, including cancer genetic counselors, oncologists and imaging centers;
- ArcherDX’s platform, with its proprietary Anchored Multiplex PCR (AMP
- ArcherDX has developed and commercialized over 325 unique products, including research products and services in use by more than 300 laboratories worldwide and has collaborated with more than 50 biopharmaceutical companies and contract research organizations (CROs), providing services that enable biopharmaceutical companies, including partners such as AstraZeneca, BMS and Bayer, to cost-effectively accelerate drug development;
- ArcherDX is also currently developing in-vitro diagnostic (IVD) products, including STRATAFIDE DX, for therapy optimization, an estimated $5 billion market opportunity with U.S. Food and Drug Administration (FDA) submissions planned this year, and the broadly applicable Personalized Cancer Monitoring (PCM) in development for disease recurrence monitoring, therapy optimization including selection, response and modulation. Both STRATAFIDE DX and PCM have received Breakthrough Device designation from the FDA;
- Together, the company will serve customers across the continuum, from individuals and community clinicians to biopharmaceutical partners, distribution partners, reference laboratories and academic centers.
With both centralized and local testing capabilities, the combined organization will offer breadth and flexibility in serving customers in more than 95 markets. Together, Invitae and ArcherDX will offer support for biopharmaceutical companies, from patient identification and screening, to biomarker identification and companion diagnostic development.
Transaction Terms
Under the terms of the agreement, Invitae will acquire ArcherDX for upfront consideration consisting of 30 million shares of Invitae common stock and $325 million in cash, plus up to an additional 27 million shares of Invitae common stock payable in connection with the achievement of certain milestones, for an overall transaction valued at approximately $1.4 billion. The transaction, which has been unanimously approved by the Boards of Directors of both companies, is expected to close in several months, subject to customary closing conditions including approval by the stockholders of Invitae and ArcherDX.
Financing Activities
In connection with the proposed combination, Invitae has arranged a strategic financing with over $400 million in financing commitments from a syndicate of life sciences investors, led by Perceptive Advisors. Invitae has entered into a definitive agreement to sell $275 million in common stock in a private placement at a price of $16.85 per share. The private placement is being supported by key existing investors in Invitae and Archer, including Casdin Capital, Deerfield Management, Driehaus Capital Management, Farallon, PBM Capital, Perceptive Advisors, Redmile Group, Rock Springs Capital, Soleus Capital, and one additional institutional investor. The placement is expected to close concurrently with the proposed combination, subject to the satisfaction of customary closing conditions. Invitae has also entered into a fully committed credit facility for up to $200 million with Perceptive Credit Opportunities Funds, subject to certain customary closing conditions.
Since the filing of its Quarterly Report on Form 10-Q for the quarter ended March 31, 2020, Invitae has sold under its ATM facility approximately 2.6 million shares of common stock for aggregate gross proceeds of $46 million at an average price of $17.59 per share.
Invitae’s current expectations regarding its cash at transaction close would be approximately $425 million and its annualized near-term forward cash burn is expected to be approximately $130 million.
Source: Invitae