Sema4 To Acquire Genomic Testing Firm In $623 Million Deal
STAMFORD, CT — Sema4, a Stamford-based patient-centered health intelligence company which has also been one of largest providers of COVID-19 testing services in Connecticut, announced on Tuesday that it will acquire GeneDx, a genomic testing and analysis firm.
The purchase price is expected to be about $623 million.
Sema4 made headlines recently after the CT Mirror reported that the company will discontinue COVID-19 testing services to the state of Connecticut by the end of January. The CT Mirror also previously reported that a venture capital firm, co-founded by Annie Lamont, Gov. Ned Lamont's wife, had made investments in Sema4.
Sema4 will acquire GeneDx for an upfront payment of $150 million in cash, plus 80 million shares in Sema4, with up to an additional $150 million revenue-based milestones over the next two years, according to the acquisition terms.
Sema4 said in an announcement that the acquisition will create "one of the largest and most advanced providers of genomic clinical testing in the U.S., with a projected $350 million in pro forma 2022 revenue."
The acquisition will allow Sema4 to partner with health systems and biopharma companies "to further transform the standard of care throughout the patient health journey," according to the announcement.
Sema4 said GeneDx, which is based in Maryland and a subsidiary of OPKO Health Inc., is a leader in rare disease and diagnostic exome sequencing services.
"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," said Sema4 CEO Dr. Eric Schadt in a news release.
"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."
Katherine Stueland, President and CEO of GeneDx, will be appointed as Sema4 co-CEO and is expected to join the Sema4 Board of Directors after the acquisition is complete.
"We are excited to join forces with Sema4, a market leader in using genomic and clinical data to deliver precision medicine," Stueland said in a news release. "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 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.
The acquisition of GeneDx and the private placement are expected to be complete in the second quarter of 2022, according to a news release.
"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," Schadt added. "We hope that this investment may serve as a foundation for potential future collaborations."
Sema4 expects total revenue for fiscal year 2022 to be in the range of $215 million to $225 million, implying 23-29 percent growth excluding revenue associated with COVID-19. For 2022, Sema4 expects to handle over 350,000 tests, excluding COVID-19 tests.
The company also focuses on women's health, oncology and biopharma.
This article originally appeared on the Stamford Patch
