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Bionano Genomics to Acquire Purigen Biosystems for up to $64M

This story has been updated from a previous version to include comments made by Bionano Genomics President and CEO Erik Holmlin during a conference call.

NEW YORK – Optical genome mapping (OGM) company Bionano Genomics said after market close on Monday that it has inked a definitive agreement to acquire Purigen Biosystems, a company that develops and commercializes automated nucleic acid extraction and purification solutions using proprietary isotachophoresis (ITP) technology.

Bionano said the transaction consideration for the proposed acquisition will be up to $64 million, including $32 million cash paid at closing "subject to adjustment for, among other things, cash, unpaid indebtedness, unpaid transaction expenses, and net working capital relative to a specified target." The remainder of the consideration is contingent on the achievement of certain milestones.

The proposed acquisition is expected to close on or before Dec. 8, 2022, Bionano said, with Cowen and Company serving as its exclusive financial advisor.

"This is an incredibly exciting day for us at Bionano," Bionano President and CEO Erik Holmlin said in a conference call to discuss the announcement. "We believe that this acquisition has the potential to help us expand the adoption of optical genome mapping by improving the way in which we isolate ultra-high molecular weight DNA for OGM."

Based in Pleasanton, California, Purigen was established in 2012 and had exclusively licensed the ITP technology, originally developed by Juan Santiago's team at Stanford University. The company currently has 28 employees, fulfilling functions such as R&D, sales and marketing, manufacturing, and customer support, Holmlin said.

According to Holmlin, Purigen's ITP technology, which uses a solution-based purification method, can be more efficient at capturing molecules from dilute solutions or from samples with small amounts of cells for OGM. "What's important about ITP is that it's a solution-based concentration approach," he said. "That means it's different from protocols that are in routine use today."

Currently, Purigen offers the ITP technology through its Ionic purification system, a commercialized automated benchtop instrument for DNA and RNA isolation. The system can tackle complex biological samples with low cell counts, including formalin-fixed paraffin-embedded (FFPE) tumor tissues, Holmlin said, and it can purify eight samples in one hour with less than five minutes of hands-on time per sample.

During his presentation, Holmlin also highlighted the expected strategic benefits of the acquisition. These include expanding the company’s arsenal of tools for sample preparation, overcoming barriers for ultra-high molecular weight DNA extraction for OGM, complementing its existing partnership with Hamilton for automation, and ultimately expanding the adoption of OGM.

"We believe that's really important for addressing routine use at scale in a commercial environment," he told investors. "In order to drive widespread adoption for OGM for routine use across our target markets — cytogenomics, discovery research, and cell bioprocessing, we're focused on creating this integrated, end-to-end solution that really maximizes some key attributes: ease of use, the speed, and the overall performance of that workflow."

After the acquisition, Holmlin said the plan is to include Klint Rose, Purigen's cofounder and current CSO, as a Bionano fellow to lead the development of ITP solutions for OGM. Meanwhile, Purigen's current location in Pleasanton, California will remain active, and the company’s employees are expected to join Bionano once the acquisition is completed.

In that regard, Holmlin said that Purigen currently has about 10 employees on its commercial team. "We'll be integrating those [employees] into our team over the coming weeks," he said. "The thinking is that we will add the Ionic system to the products that the Bionano team is selling and integrate their selling team into that commercial group."

Holmlin said the goal of the integration plan is to fully support existing Purigen customers and expand the Ionic systems installed base to position Bionano as "a key solution provider throughout molecular pathology and cyto-genomics." According to him, there are currently about 50 Ionic systems installed worldwide. "We believe that this is a great way to expand the Bionano customer base," Holmlin added. "This is a strategic product that opens doors for us."

Ultimately, the goal for Bionano through this transaction is to commercialize the Ionic system with kits that are specifically developed for OGM for many sample types.

"These are certainly some ambitious goals that we believe we can accomplish together with the world-class team at Purigen," Holmlin said. "After the close, we are enthusiastic about welcoming the entire Purigen team into Bionano."