Cancer Genetics, Inc. (the “Company”) (Nasdaq: CGIX), and StemoniX,
Inc., today announced the entry into a definitive merger agreement.
Cancer Genetics is a leader in drug discovery and preclinical
oncology and immuno-oncology services. StemoniX, a
private company, is a leader in developing
high-throughput disease-specific human organoid platforms
integrated with leading-edge data science technologies. Under
the terms of the merger agreement, StemoniX will merge with a newly
formed subsidiary of Cancer Genetics in an all-equity transaction.
Upon shareholder approval, the combined company expects to remain
listed on the Nasdaq Stock Market. StemoniX will retain its name
and become a wholly-owned subsidiary of Cancer Genetics.
The transaction will position the combined
company to harness the synergies between two critical modalities of
drug discovery and development - advanced animal models and
relevant human high-throughput organoid platforms. The resulting
integration of scientific and technology-based expertise, skilled
management teams, and ability to offer customers an end-to-end
platform will de-risk and accelerate development of preclinical and
clinical pipelines for biopharma partners as well as for the
proprietary pipeline of the combined company. In combination,
Cancer Genetics and StemoniX currently enjoy partnerships and
R&D relationships with dozens of global pharmaceutical and
biotechnology companies.
"The process of discovering and developing a new
drug candidate takes years and comes with a price tag of hundreds
of millions - or even billions - of dollars. However, we are at
unique time in the drug discovery industry as the convergence of
technological innovations in both biology and software will
transform conventional workflows in time and accuracy. To convert
the time-consuming and labor-intensive process of developing a drug
for market, we now look to supplement traditional discovery and
drug approval mechanisms to include humanized cell-based assays
with artificial intelligence (AI) along with our core vivoPharm
business. Given that our strategy and approach are strongly aligned
with those of StemoniX, we are pleased to have moved forward with
this proposed transaction," stated Jay Roberts, Chief Executive
Officer of Cancer Genetics.
“The pharma industry and society are at a
critical pivot point. Viral pandemics and diseases lacking
treatments require a new way of innovation. The proposed merger
expects to expand our ability to engage with a larger audience of
potential partners and expand our internal capabilities as we
deliver on our mission to rapidly discover the safest and most
effective therapeutics on behalf of our partners and our
shareholders. The mission will stay consistent - allow scientists
to quickly and economically conduct high-throughput toxicity and
drug development studies in ready-to-assay plates containing
functional microOrgans®,” stated Ping Yeh, Chief Executive Officer
of StemoniX.
ABOUT THE TRANSACTION
Pursuant to the merger agreement, Cancer
Genetics will acquire all of the outstanding capital stock of
StemoniX in exchange for a number of shares of its common stock
which will represent approximately 78% of the outstanding common
stock of Cancer Genetics, subject to certain adjustments and prior
to the effects of the financing referred to below, with the current
equity holders of Cancer Genetics retaining 22% of the common stock
immediately following the consummation of the merger.
The Boards of Directors of both companies have
approved the proposed merger, which is expected to close in the
fourth quarter of 2020, subject to the approval of the shareholders
of both Cancer Genetics and StemoniX, financing and other customary
closing conditions.
H.C. Wainwright & Co. is acting as financial
advisors to the Board of Directors of Cancer Genetics, and
Lowenstein Sandler is acting as its legal counsel. Northland
Securities, Inc. is acting as financial advisor to the Board of
Directors of StemoniX and Taft, Stettinius & Hollister is
acting as its legal counsel.
ABOUT CANCER GENETICS
Through its vivoPharm subsidiary, Cancer
Genetics offers proprietary preclinical test systems supporting
clinical diagnostic offerings at early stages, valued by the
pharmaceutical industry, biotechnology companies and academic
research centers. The Company is focused on precision and
translational medicine to drive drug discovery and novel therapies.
vivoPharm specializes in conducting studies tailored to guide drug
development, starting from compound libraries and ending with a
comprehensive set of in vitro and in vivo data and reports, as
needed for Investigational New Drug filings. vivoPharm operates in
The Association for Assessment and Accreditation of Laboratory
Animal Care International (AAALAC) accredited and GLP compliant
audited facilities. For more information, please visit
www.cancergenetics.com.
ABOUT STEMONIX, INC.
StemoniX is empowering the discovery of new
medicines through the convergence of novel human biology and
software technologies. StemoniX develops and manufactures
high-density, at-scale human induced pluripotent stem (iPSC)
cell-derived neural and cardiac screening platforms for drug
discovery and development. Predictive, accurate, and consistent,
these human models enable scientists to quickly and economically
conduct research with improved outcomes in a simplified workflow.
Through collaborations with drug discovery organizations, StemoniX
tests compounds in-house, creates new cell-based disease models,
and operationalizes custom human iPSC disease models at large scale
for high-throughput screening. With leading-edge iPSC technologies
and data science, StemoniX is helping global institutions bring the
most promising medicines to patients. To learn more about how
StemoniX products and services are accelerating discoveries, please
visit www.StemoniX.com.
For more information, please visit or
follow CGI at:
www.cancergenetics.com
Twitter: @Cancer_Genetics
And StemoniX at:
www.StemoniX.com
Forward Looking Statements:
This press release contains forward-looking
statements within the meaning of the Private Securities Litigation
Reform Act of 1995. All statements pertaining to Cancer Genetics
Inc.’s expectations regarding satisfaction of closing conditions,
consummation of the merger, future financial and/or operating
results, and potential for our services, future revenues or growth
in this press release constitute forward-looking statements.
Any statements that are not historical fact
(including, but not limited to, statements that contain words such
as “will,” “believes,” “plans,” “anticipates,” “expects,”
“estimates”) should also be considered to be forward-looking
statements. Forward-looking statements involve risks and
uncertainties, including, without limitation, risks inherent in our
ability to satisfy all closing conditions to the merger, our
attempts to adapt to the global coronavirus pandemic, achieve
profitability by increasing sales of our pre-clinical services,
maintain our existing customer base and avoid cancellation of
customer contracts or discontinuance of trials, raise capital to
meet our liquidity needs and conditions to the merger, properly
evaluate strategic options, and other risks discussed in the Cancer
Genetics, Inc. Form 10-K for the year ended December 31, 2019 and
Form 10-Q for the quarter ended June 30, 2020, along with other
filings with the Securities and Exchange Commission. These
forward-looking statements speak only as of the date hereof. Cancer
Genetics, Inc. disclaims any obligation to update these
forward-looking statements.
Investor Contacts: Jennifer K. Zimmons.
Ph.D.Investor RelationsZimmons International Communications,
Inc.Email: jzimmons@zimmonsic.comPhone: +1.917.214.3514
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