Last May, NeoGenomics made a $25m minority equity investment in Inivata and obtained a fixed price option to buy the remaining stake in Inivata for $390m before the end of this year.
NeoGenomics plans to fund the acquisition using balance sheet cash and private placement of equity, with $200m anticipated in gross proceeds.
The private placement will be led by institutional investors, including legacy Inivata shareholders, current NeoGenomics investors and various other investors focusing on oncology.
NeoGenomics CEO Mark Mallon said: “NeoGenomics has spent the better part of the last year working in partnership with the exceptional team of professionals at Inivata while conducting confirmatory due diligence on the business and its world-leading liquid biopsy platform technology.
“We are exercising our option to purchase Inivata eight months ahead of plan at what we believe is an attractive value in today’s mergers and acquisitions marketplace for liquid biopsy companies.”
On concluding the acquisition, Inivata will become a division of NeoGenomics, which also operates clinical, pharma and informatics units.
Furthermore, Inivata CEO Clive Morris will be appointed as its president and will report to Mallon.
Morris said: “By leveraging our combined resources, we expect to accelerate the development of our promising RaDaR minimal residual disease (MRD) assay and accelerate commercialisation efforts with biopharma before driving a successful launch into the clinical setting.
“Our two organisations are culturally aligned and highly complementary in capabilities and we are excited to combine with NeoGenomics.”
To supplement the existing field force, NeoGenomics plans to invest in a next-generation sequencing (NGS) salesforce to expedite the uptake of InVisionFirst-Lung and RaDaR upon commercial availability.
This is separate from Inivata’s ongoing commercial collaboration with Agendia, which will provide RaDaR to breast cancer experts in oncology.
The transaction is anticipated to conclude alongside the private placement in June.