Sema4 acquires GeneDx for $ 623 million to strengthen AI-driven genomics platform

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What you should know:

-Today, Sema4 (Nasdaq: SMFR), a health intelligence company, announced that it has signed a final agreement acquire GeneDx, a leader in genomic testing and analysis, at a purchase price of approximately $ 623 million, bolstering its market-leading healthcare intelligence and genomic detection offerings.

– The combined company is expected to provide $ 350 million in pro forma revenue in 2022. In connection with the acquisition, Sema4 also completed a $ 200 million private placement of top-tier investors, including Pfizer. .


Advanced genomic testing for patients and their families

Founded in 2000, GeneDx’s leading rare disease diagnosis and exome sequencing services, and the market-leading exome database, strengthen Traversa ™, Sema4’s comprehensive genomic analysis platform for optimize health testing, as well as strengthen Centrellis®, its patented healthcare intelligence platform. Sema4 plans to leverage the combined health information database to transform patient care and therapeutic development.

Financial conditions

Under the terms of the agreement, Sema4 will acquire GeneDx for an initial payment of $ 150 million in cash plus 80.0 million shares in Sema4, with additional milestones based on revenue of up to $ 150 million over the next few years. two years (to be paid in cash). or Sema4 shares at the discretion of Sema4). According to the closing price of Sema4 shares on January 14, 2022, the total initial consideration is approximately $ 473 million, and the total consideration, including potential milestones, is approximately $ 623 million. The acquisition, which has been approved unanimously by Sema4 and OPKO’s boards of directors, is expected to close in the second quarter of 2022, subject to normal closing conditions, including approval by Sema4 shareholders.

Private placement

In connection with the acquisition, Sema4 has also signed final agreements for private placement financing to sell $ 200 million in Class A common stock at a price of $ 4.00 per share of a trade union. institutional investors, including Pfizer.

Post-acquisition plans

Companies expect to complete the acquisition in the second quarter of 2022, positioning Sema4 to grow and scale its genomic supply and further transform the standard of care for health systems and patients throughout their lives.

Katherine Stueland, President and CEO of GeneDx and former CCO of Invitae, will be appointed as co-CEO of Sema4 and is expected to join the Board of Directors of Sema4 once the acquisition is completed. She brings significant business and operational experience and will lead global operational excellence and business planning, and will focus on the diagnostic business. Dr. Schadt will continue to serve Sema4 as co-CEO and as a member of the Board of Directors focusing on the key components of Sema4’s R&D and IT platform, the strategic development of the health intelligence capabilities of Sema4. Sema4 and partnerships with health systems and biopharmaceutical companies. . Together as co-CEO, Dr. Schadt and Mrs. Stueland will drive the overall strategy and direction of the company.

“This acquisition gives us the opportunity to accelerate the use of genomics as a standard of care by providing a deeper menu of precision medicine solutions to our healthcare system partners to better meet their clinical needs,” he said. to say. Eric Schadt, PhD, founder and CEO of Sema4. “Adding the full data set and capabilities of GeneDx to our offerings allows us to report on an even wider range of diseases, further closing the gap between the practice of medicine and the availability of a more clinically actionable guide. GeneDx’s operational prowess and market-leading cost structure in exome and genome sequencing will also help accelerate our path to improving gross margins and profitability. “Katherine on our leadership team. She and her team’s world-class experience will be critical to our continued growth and success.”



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