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Biomonitor Acquires Irish Startup Neutekbio To Move into Cell-Based Assay Kit Market

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Danish firm Biomonitor this week announced that it has acquired Irish cell-based assay and kit developer Neutekbio.
 
Several news agencies reported that the acquisition price was €7 million ($9 million). A Biomonitor spokesperson claimed that the amount is not accurate but declined to furnish additional details.
 
A Biomonitor official told CBA News this week that Neutekbio’s gene reporter technology and its iLite technology-based assays and kits will complement its existing offerings to physicians and clinics treating patients with multiple sclerosis, rheumatoid arthritis, and Crohn’s disease, and biopharmaceutical companies that develop drugs for these conditions.
 
Neutekbio’s product line “matches perfectly with Biomonitor's existing assays and services to measure the levels of drugs based on cytokines, such as interferons and TNF-α antagonists, as well as antibodies to these drugs,” Biomonitor CEO Arsalan Kharazmi told CBA News in an e-mail.
 
He added that cell-based assays using iLite kits are “excellent” tools for monitoring patients receiving these drugs by analyzing levels of neutralizing antibodies to the drugs, and can also be used to evaluate levels of neutralizing antibodies to drugs during the preclinical and clinical development stages.
 
To complete the Neutekbio acquisition, Biomonitor received financial support from Danish venture capital firm Sunstone Capital. Neutekbio was targeting the same pharmaceutical and biotech customers as Biomonitor, but with a different offering, Søren Lemonius, a partner in Sunstone Capital, said this week.
 
Biomonitor supports the biopharma industry by helping them monitor patients enrolled in clinical trials by receiving and analyzing patient samples and, when relevant, comparing the results to its reference database of patients treated with biopharmaceuticals such as interferon and anti-TNF-α drugs. By comparison, Neutekbio offers assay kits based on its iLite technology that drug makers can use in their own labs.
 
The reference laboratory and expertise of Biomonitor will also allow it to develop new assay kits for the biopharma industry based on the iLite technology. “Accordingly, it is an excellent match, and will allow us to grow Biomonitor faster and provide us with potentially both a higher and earlier return on investment,” said Lemonius.
 
Biomonitor said that it intends to retain Neutekbio’s R&D and manufacturing operations in Ireland and its ongoing collaboration with France’s Centre National de la Recherche Scientifique in Paris.
 
“This [acquisition] is very positive for Neutekbio,” according to former CEO Robert Erickson, current managing director of Biomonitor’s Galway-based operations. He added that Neutekbio will not be relocating.
 

“The gene reporter technology, as well as the assays and kits based on [Neutekbio’s] iLite technology platform, matches perfectly with Biomonitor's existing assays and services.”

“We have R&D and ISO13485-certified manufacturing facilities in Galway, and research activities in Villejuif, France,” Erickson said.
 
Neutekbio, founded in 2003, employs eight staffers. “Our fit with Biomonitor is excellent,” said Erickson. “They are a leading special clinical reference company, and have a service-oriented business model.”
 
Erickson explained that clinical investigations and monitoring patient response to biotherapeutics are the “keys” to this acquisition.
 
Biomonitor collaborates with a number of pharmaceutical companies that make anti-TNF-α drugs, which are typically used to treat autoimmune disorders such as rheumatoid arthritis and Crohn’s disease.
 
“We are not selling them the iLite kits, because we did not own the company before, but we are getting clinical samples from pharma companies in the anti-TNF area,” Kharazmi told CBA News.
 
The global market for services that measure patient levels of biopharmaceutical dugs and levels of antibodies to drugs, and supporting biopharma companies with pharmacokinetic studies and immunogenicity testing, is approximately $1 billion, said Kharazmi. He added that 67 percent of that figure represents the US market, “so $600 million to $700 million in the US.”
 
Biomonitor has not done an extensive market analysis for the iLite kits. However, “we expect that it is potentially a large market, because it would be particularly useful for preclinical studies in the area of interferon and anti-TNF drug development,” Kharazmi said. He also said that Biomonitor expects the global market for the kits to be “at least $300 million or $400 million per year.”
 
Neutekbio’s iLite kits are sold in the US by PBL InterferonSource, a supplier of interferon-based products, and in Europe directly by Neutekbio. Kharazmi said that Biomonitor is negotiating with companies to enter the Asian market, and is also looking to see if it can do this directly with PBL, which plays in the Japanese market.
 
In terms of the logistics of the acquisition, Kharazmi said that “the setup in Galway is excellent … and they have all the capabilities to increase production.” He said Biomonitor would increase the staff as more customers purchase the iLite kits, and added that Biomonitor is developing additional kits based on the same technology platform.
 
These include an anti-TNF-α kit that would be launched in spring 2009. “There are also some additional signal transduction surface marker kits that we are planning, and will hopefully launch in 2009 or 2010,” said Kharazmi. He did not elaborate.