NEW YORK (GenomeWeb News) – Bio-Reference Laboratories today said that it is making an equity investment of up to $6 million in molecular diagnostics firm InCellDx.
Under the terms of the agreement, Bio-Reference will purchase up to $6 million in shares of InCellDex's preferred stock and warrants representing between 20 percent and 25 percent of InCellDx, depending on dilution resulting from the exercise of outstanding options. The $6 million investment will be comprised of $4 million in cash and $2 million by promissory note.
The promissory note is payable to InCellDx on an as-needed basis. The amount of the note and the corresponding number of shares and warrants will be proportionately reduced if IncellDx does not need the entire $2 million, Bio-Reference said.
In 2011, InCellDx had total revenues of $1.1 million.
Based in Menlo Park, Calif., InCellDx develops tests for the detection and monitoring of hepatitis, cervical cancer, breast cancer, HIV/AIDS, and organ transplant rejection.
Bio-Reference's GenPath Women's Health this month launched the GenCerv test based on InCellDx's HPV mRNA quantification technology, which allows for the quantification of molecular biomarkers inside intact cells using cell-based instruments and in situ hybridization.
GenPath adapted the technology for quantifying E6 and E7 mRNA in HPV. InCellDx Founder and CEO Bruce Patterson said that 95 percent of women who test positive for high-risk HPV do not progress to cervical cancer and the GenCerv test may help doctors identify patients who do progress to the disease.
Marc Grodman, president and CEO of Bio-Reference, added in a statement, "We anticipate that this technology, which has been well reviewed in academic publications, should not only improve the specificity that accompanies HPV testing, but also should be cost effective in identifying those HPV cases that do not progress to cervical cancer."
Grodman has been named the chairman of InCellDx, and Charles Todd, senior vice president of sales and marketing at Bio-Reference, is joining InCellDx's board.