NEW YORK (GenomeWeb) – Sysmex, a Japanese in vitro diagnostics company, has signed a deal to acquire all the shares of Oxford Gene Technology, OGT said today.
Upon completion of the deal, OGT will become a wholly owned subsidiary of Sysmex. Further terms were not disclosed, though OGT CFO Tim Hall said that the deal is likely to close by mid-June.
Once Sysmex acquires OGT, the British maker of molecular analysis tools will remain intact as a company, answering directly to Sysmex's management in Kobe. "There will be no change in corporate structure, and the various companies within the OGT group will remain," Hall said.
OGT was founded in 1995 by Edwin Southern, a University of Oxford molecular biologist and microarray innovator. The company expanded under the stewardship of Mike Evans, who joined as CEO in 2005, and OGT acquired Sense Proteomic in 2009, and Cytocell in 2014, while developing its array and next-generation sequencing offerings. It currently employs around 100 people.
According to Hall, Southern, 78, remains a majority owner of OGT, but had been looking to sell the firm to an appropriate partner, while focusing his resources on charitable activities.
"There have been plenty of suitors," Hall said, "considering the growth we've experienced recently."
In a statement, OGT disclosed that for its fiscal year that ended on September 30, 2016 OGT recorded sales of £19.7 million ($25.3 million), mainly from sales of its Cytocell fluorescence in situ hybridization probes, SureSeq next-generation sequencing products, and CytoSure microarrays that together grew collectively by 30 percent in FY16 compared to the prior year.
"They see arrays as very complementary to the rest of the business, and all of it fits together very nicely," said Emma Shipstone, executive vice president of marketing at OGT.
While arrays, particularly for cytogenetics, have remained the cornerstone of OGT's business since its founding, Hall said that Sysmex was drawn to the company after using its Cytocell FISH probes together with Flow FISH, an automated system that Sysmex codeveloped with Merck. "The initial talks around FISH probes led to where we are now," he said.
The company's R&D teams are already planning to collaborate on developing an automated system for FISH testing, Hall said, that will pair the system with OGT's reagents. OGT's expertise in sequencing was also a factor in the deal, Shipstone added. In a statement, Sysmex said that OGT's next-generation sequencing "reagent development capabilities" will enable it to "reinforce [its] technology base in the area of genomic medicine."
Sysmex has been active in recent years, particularly through Sysmex Inostics, its molecular diagnostics subsidiary, in attempting to bring liquid biopsy-based molecular tests to the clinical market, either using sequencing as a technology platform, or its BEAM emulsion-based digital PCR technology. Merck and Sysmex garnered a CE-IVD mark for a test for colorectal cancer based on the latter platform last year.
"They are interested in putting this all together from a liquid biopsy perspective," said Shipstone, "from their desire to enhance personalized medicine."
While Sysmex and OGT's R&D teams plan business opportunities, OGT will also raise its international profile thanks to its relationship with Sysmex, which employs 8,000 people worldwide, and does half its business in Asia, with the remainder in Europe and North America. By comparison, the majority of OGT revenues are generated in Europe and North America, the only regions where it has direct sales representatives.
"They have a large organization with a much larger footprint," said Shipstone, "so there are absolutely opportunities for us to expand our business."