The US-based AI-driven genomic and clinical data intelligence platform company, Sema4 has entered into an agreement to acquire OPKO Health’s subsidiary firm, GeneDx, a leader in genomic testing and analysis
The acquisition will strengthen Sema4’s leadership, growth, and scalability for its market-leading health intelligence and genomic screening offerings. With a pro forma revenue of $350 million in 2022, Sema4 and GeneDx will emerge as one of the largest and most advanced providers of genomic clinical testing in the United States.
“This acquisition gives us the opportunity to accelerate the use of genomics as standard of care by providing a deeper menu of precision medicine solutions to our health system partners to better meet their clinical needs. Adding GeneDx’s comprehensive dataset and capabilities to our offerings enables us to inform on an even broader range of diseases, further closing the gap between the practice of medicine and the availability of more clinically actionable guidance. GeneDx’s operational prowess and market-leading cost structure in exome and genome sequencing will also help accelerate our path to improved gross margins and profitability. I am also delighted to welcome Katherine to our leadership team. She and her team’s world-class expertise will be critical to our continued growth and success.”Dr. Eric Schadt, PhD, Founder and CEO of Sema4
Dr. Schadt added, “We are excited to announce this investment with the support of several key institutions, including Pfizer. We believe that genomics and data, when harnessed in partnership with health systems, can be a powerful tool to enable precision medicine by bringing novel therapies to patients faster and more effectively. We hope that this investment may serve as a foundation for potential future collaborations.”
“We are excited to join forces with Sema4, a market leader in using genomic and clinical data to deliver precision medicine,” said Ms. Katherine Stueland President and CEO of GeneDx. “The complementary fit between our teams, missions, and capabilities is strong. We are eager to put those strengths to work and to make it easier to use data-driven insights to improve healthcare for all. I’m looking forward to partnering with Eric to create an unrivaled family health and health intelligence company, supporting patients making healthcare decisions throughout their lives, from pregnancy and newborn health to adult rare disease, risk assessment, and cancer care.”
Sema4 will be well-positioned to engage with health systems and biopharma companies to further improve the standard of care across the patient’s health journey once the acquisition is completed. GeneDx’s leadership in rare disease diagnostic and exome sequencing services will bring more than 300,000 clinical exomes and over 2.1 million expertly annotated phenotypes to strengthen Sema4’s 12 million de-identified clinical records for optimizing health screenings.
Currently, Sema4 has a proprietary integrated health intelligence platform, Centrellis, and a comprehensive genomic analysis platform, Traversa. Sema4 plans to leverage this combined health information database to transform patient care and therapeutic development and enable precision medicine for all.
As part of the transaction, Sema4 has also announced that it has entered into definitive agreements for a $200 million private placement of Sema4 Class A shares from a syndicate of institutional investors, including Pfizer.
“We believe the sale of GeneDx to Sema4 will unlock untapped value and maximize the value of GeneDx for the benefit of OPKO shareholders. In addition to bolstering our cash position, we will have a significant equity stake in Sema4 at closing, ensuring OPKO and our shareholders continue to participate in the rapidly growing genomics market through a continued investment in GeneDx, which we believe is well positioned to deliver long-term success.”Phillip Frost, MD, Chairman and CEO of OPKO
Under the terms of the agreement, Sema4 will acquire GeneDx for an upfront payment of $150 million in cash in addition to 80.0 million shares in Sema4, with up to an additional $150 million revenue-based milestones over the next two years. The acquisition has been unanimously approved by the Board of Directors of both firms and is expected to close in the second quarter of 2022.
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