VolitionRx Limited (NYSEAMERICAN:VNRX) revealed Monday that its subsidiary Belgian Volition SPRL struck an agreement to acquire an epigenetic reagent company, Octamer GmbH for around €650,000 euros ($725,000) in cash and stock.
In a statement, the multi-national life sciences company that develops easy-to-use blood-based cancer tests to diagnose cancers, said the deal is expected to close in January 2020.
“This strategic acquisition helps secure the supply of one of the key components of Volition's Nu.QTM tests, the recombinant nucleosome used as the calibrant,” said the company.
Commenting on the deal, VolitionRx Limited CEO Cameron Reynolds said he could not be happier as the acquisition allowed the company to work with biologist Dr Adrian Schomburg, one of the world's top nucleosome experts.
“Not only will this deal secure the supply of a wide range of our key components, but it will also facilitate the transfer of know-how and expertise so that we can develop the capability to manufacture recombinant nucleosomes ourselves,” said Reynolds. “This deal enhances our goal of becoming one of the world's leading epigenetics companies."
VolitionRx is an epigenetics company and at the center of its work is the NuQ platform, which looks for molecular signatures of cancer by focusing on the nucleosomes — a section of DNA wrapped around a core of proteins — in the blood. As cancer cells multiply, they are modified in a way that distinguishes them from healthy cells and the traits of the malignant disease appear on the nucleosomes, which are analyzed by the Nu.Q platform.
The company has designed a routine blood test called Nu.Q to screen for colorectal and prostate cancers that reduces the need for more invasive colonoscopies and biopsies. VolitionRx is also developing the technology as a screening tool for endometriosis and for veterinary uses as well.
Good marriage of technologies
"The progress that Volition has made to date on nucleosomes in circulation is very exciting and I have confidence that this deal is a good convergence of our two technologies and companies,” said Octamer GmbH founder CEO Adrian Schomburg.
“I look forward to working together to bring these transformative diagnostic agents into everyday diagnostic practice," he added.
In addition to nucleosomes, Octamer manufactures and sells histones, octamers and DNA templates. These reagents can be used for custom applications in epigenetic research and drug discovery. Octamer is already revenue-generating and has many business development opportunities that Volition plans to exploit in 2020.
Volition will pay Octamer 650,000 euros ($725,000), with 350,000 euros in cash and roughly 73,000 in shares for 100% of the outstanding shares of Octamer. As part of the deal, the parties struck a five-year royalty agreement that provides for single-digit royalties based on the sales by Octamer of recombinant nucleosomes to pharmaceutical companies for use in the development, manufacture and screening of molecules for use as therapeutic drugs, as well as a consulting arrangement with Dr Schomburg.
Volition's research and development activities are centered in Belgium, with additional offices in Texas, London and Singapore, as the company focuses on bringing its diagnostic products to market.
Contact the author Uttara Choudhury at [email protected]
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