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Entelos Acquires Iconix in $14.1M Deal

Entelos yesterday said that it has acquired toxigenomics firm Iconix Biosciences in an all-share transaction initially valued at $14.1 million but with the potential of rising to $39 million.
 
Foster City, Calif.-based Entelos said that it would issue up to 12,776,658 shares of its stock to Iconix shareholders and a potential maximum earn-out payment of $25 million if certain milestones are achieved within one year following the close of the deal today. The deferred consideration also would be paid in Entelos shares.
 
“We believe the combination of our predictive efficacy models with Iconix’s toxicology expertise can create a new paradigm for discovering and developing drugs,” James Karis, president and CEO of Entelos, said in a statement. “Drug failures are often due to efficacy or toxicity issues, and while Entelos’ predictive disease models address efficacy, Iconix’s toxicology databases help to address toxicities.”
 
The deal combines Entelos’ PhysioLab in silico disease model platform with Iconix’s DrugMatrix toxigenomics system.
 
Following completion of the acquisition, Iconix will become part of Entelos’ Technology and Services Division. Entelos intends to consolidate certain of Iconix’s administrative and operational positions at its Foster City headquarters.
 
Jim Neal, CEO of Mountain View, Calif.-based Iconix, will join Entelos as chief business officer.
 
Iconix reported fiscal 2006 revenue of $4.9 million with a net loss of $11.2 million. Entelos expects Iconix’s operations to add roughly $1 million to its 2007 revenues.

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