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Sequenom Sells Bioscience Business to Agena for $31.8M

NEW YORK (GenomeWeb) – Sequenom said after the close of the market Friday that it has sold its bioscience business, which includes its MassArray system, to Agena Bioscience for $31.8 million.

Sequenom had said in September that it would conduct a strategic review for the business, formerly called the Genetic Analysis segment, but at the time didn't offer details on the reason for seeking a potential sell off.

"This sale strengthens our balance sheet, and will enable us to focus exclusively on our Sequenom Laboratories business as we work toward achieving profitability," Sequenom Chairman and CEO Harry Hixson said in a statement today.

Sequenom's sales have been increasingly driven by its Sequenom Laboratories business, and in particular its MaterniT21 Plus noninvasive prenatal test for fetal aneuploidy. It recently reported a 20 percent year-over-year increase for its first quarter revenues.

The bioscience business' flagship product is the MassArray system, a mass spectrometry-based platform for measuring genetic target material and variations. It also includes Sequenom's iPlex assay for analyzing multiplex SNPs and somatic mutations.

Agena, a San Diego-based portfolio company of investment firm Telegraph Hill Partners, will pay $31.8 million, but may pay an additional $4 million in contingent consideration based on certain regulatory and sales milestones. It also has assumed certain liabilities of the bioscience business and has taken over the facility lease for that business. Agena also said that it will offer employment to all of the employees of the bioscience business.

Agena also intends to file for US Food and Drug Administration clearance of the MassArray platform with the IMPACT Dx System, for which Sequenom filed a 510(k) application last year.

Piper Jaffray Senior Research Analyst William Quirk pointed out in a research note that the selling price for the bioscience business was below its FY 2013 revenues of $42.9 million and represents a discount from historical diagnostic/life science tools M&A transactions, which generally run around 2x revenues.

"We are encouraged with Sequenom focusing resources in higher margin products (NIPT testing), although we are surprised with the ultimate selling price of the Bioscience business," Quirk said.

In Monday morning trade on the Nasdaq, shares of Sequenom were down 1 percent at $3.03.

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