Myriad to acquire Assurex Health
Myriad Genetics, a leader in molecular diagnostics and personalized medicine, has signed a definitive agreement to acquire Assurex Health, a global leader in genetic testing for psychotropic medicine selection, for $225 million upfront with the potential for $185 million in additional performance-based milestones. Assurex generated revenue of more than $60 million and tested more than 150,000 patients in Myriad's fiscal year 2016.
The transaction is expected to close at the end of Myriad's first quarter of fiscal year 2017. Myriad will provide financial guidance pertaining to the acquisition when the Company hosts its fourth-quarter earnings call on August 9, 2016. A discussion on the details and strategy underlying this acquisition will be provided on a conference call today at 4:30 pm EDT.
"Assurex provides Myriad access to GeneSight one of the fastest growing new diagnostic tests ever in a multi-billion dollar global market and builds upon Myriad's commitment to expand into neuroscience, positioning us for long-term growth," said Mark C. Capone, president and CEO, Myriad Genetics. "Importantly, this acquisition provides an experienced commercial organization in the neuroscience market that we believe will be one of the highest growth areas for personalized medicine and completes our infrastructure expansion consistent with our four-in-six strategy."
"We are excited as a fellow pioneering company to be joining the global leader in personalized medicine," said Virginia C. Drosos, president and CEO, Assurex Health. "As one of the world's leading molecular diagnostic companies, Myriad has the reimbursement, regulatory and commercial expertise to expand the long-term potential of Assurex's neuroscience products and ensure even more patients can benefit from better outcomes through our diagnostic tests."
Benefits of the Transaction:
- Allows entry into attractive neuroscience market: In the U.S., more than 76 million individuals have a mental disorder. The U.S. spends more than $150 billion in direct healthcare costs, or 6% of overall healthcare spending, treating these disorders. Myriad sees a substantial medical need for high-value personalized medicine products such as the GeneSight test to improve patient outcomes and lower healthcare costs.
- Synergistic product fits 4in6 strategy: GeneSight provides Myriad with its first commercial product in the neuroscience market and answers the fourth clinical question regarding therapy selection for psychotropic drugs. Additionally, this acquisition adds the final business unit contemplated in its 4in6 strategy and provides the largest non-pharmaceutical sales force in the psychiatry market.
- Best-in-class product in large market: GeneSight Psychotropic fills a significant unmet clinical need, is supported by substantial clinical data and is the market leading product for psychotropic drug selection, with significant barriers to entry. Additionally, the global market for GeneSight testing is greater than $4 billion based upon current and future indications.
- Ability to leverage psychiatry call point with future products: Myriad is developing a differential diagnosis product for major depressive disorder and bipolar disorder called myPath Bipolar. Myriad will be able to leverage the psychiatry call point to sell this test in the future, along with other potential high-value diagnostics.
Myriad intends to fund the transaction through cash on hand and debt. Myriad has obtained committed debt financing from JPMorgan Chase & Co. At the end of the fiscal third quarter Myriad had cash and cash equivalents of $286 million. The transaction is expected to close before the end of the first quarter of fiscal year 2017 and is subject to the satisfaction of customary closing conditions and regulatory approvals.