Gen-Probe Makes $50 Million Strategic Investment in Third Generation Sequencing Company Pacific Biosciences
-- Companies to Collaborate on Developing Products for Clinical Diagnostics Use --
SAN DIEGO and MENLO PARK, Calif., June 17 /PRNewswire-FirstCall/ -- Gen-Probe Incorporated (Nasdaq: GPRO) and Pacific Biosciences announced today that Gen-Probe has made a $50 million strategic investment in Pacific Biosciences, a private sequencing company. In addition, the companies will work together to explore co-development of new integrated clinical diagnostics systems based on Pacific Biosciences' Single Molecule Real Time (SMRTTM) platform and Gen-Probe's expertise in diagnostics.
Gen-Probe and Pacific Biosciences will initially collaborate on an exclusive basis for up to 30 months, with the goal of developing a longer-term, preferred business relationship aimed toward improving the diagnosis of human diseases. The companies can also purchase certain of each others' products on preferential terms.
"We believe Pacific Biosciences' third-generation, single-molecule sequencing technology has the potential to play an important long-term role in strategically valuable, high-growth clinical diagnostics markets such as oncology, transplant diagnostics and pharmacogenomics due to its fast time to result, long read lengths, and ability to interrogate broad genomic regions in high resolution," said Carl Hull, Gen-Probe's president and chief executive officer. "We are excited to collaborate with Pacific Biosciences to develop an innovative sequencing system based on their best-in-class technologies."
Pacific Biosciences' SMRT DNA sequencing is expected to be a transformative technology that enables a new paradigm in genomic analysis. It enables, for the first time, the observation of natural DNA synthesis by a DNA polymerase as it occurs. The approach is based on eavesdropping on a single DNA polymerase molecule working in a continuous, processive manner.
"We see a significant opportunity for our SMRT platform in the molecular diagnostics market and are taking a proactive and strategic approach by collaborating with Gen-Probe, a proven leader in developing fully automated instrument systems for nucleic acid testing," said Hugh Martin, chairman and chief executive officer of Pacific Biosciences. "We believe Gen-Probe's expertise in instrument systems engineering and sample preparation, combined with their capabilities in clinical and regulatory affairs, will help us maximize the potential of our sequencing technology to benefit human health."
Gen-Probe's $50 million investment is part of a larger Series F private round of financing by Pacific Biosciences.
About Pacific Biosciences
Pacific Biosciences' mission is to transform the way humankind acquires, processes and interprets data from living systems. The company has developed a disruptive technology platform for the real-time detection of biological events at single molecule resolution. Single Molecule Real Time (SMRT) Biology is designed to revolutionize life sciences by revealing the underlying networks that define living systems. The first application for the SMRT Biology platform is a paradigm changing approach to DNA sequencing. The SMRT Sequencing System should ultimately make it possible to sequence individual genomes as part of routine medical care. DNA sequencing is expected to be the first of many transformative SMRT Biology applications that will benefit society by driving radical advances in fields such as personalized medicine, agriculture, clean energy, and global health.
Gen-Probe Incorporated is a global leader in the development, manufacture and marketing of rapid, accurate and cost-effective molecular diagnostic products and services that are used primarily to diagnose human diseases, screen donated human blood, and ensure transplant compatibility. Gen-Probe has approximately 27 years of expertise in nucleic acid testing, and received the 2004 National Medal of Technology, America's highest honor for technological innovation, for developing NAT assays for blood screening. Gen-Probe is headquartered in San Diego and employs approximately 1,300 people. For more information, go to www.Gen-Probe.com.
As of March 31, 2010, Gen-Probe had $534.3 million of cash, cash equivalents and marketable securities, and $240.8 million of short-term debt. The Company generates roughly $10 million in free cash flow a month.
Caution Regarding Forward-Looking Statements
Any statements in this news release about Gen-Probe's expectations, beliefs, plans, objectives, assumptions or future events or performance are not historical facts and are forward-looking statements. These statements are often, but not always, made through the use of words or phrases such as believe, will, expect, anticipate, estimate, intend, plan and would. For example, statements concerning future development efforts, possible or expected results of operations, regulatory approvals, future milestones, growth opportunities, and plans of management are all forward-looking statements. Forward-looking statements are not guarantees of performance. They involve known and unknown risks, uncertainties and assumptions that may cause actual results, levels of activity, performance or achievements to differ materially from those expressed or implied. Some of these risks, uncertainties and assumptions include but are not limited to: (i) the risk that our effort to develop sequencing systems with Pacific Biosciences will not be successful, (ii) the risk that any sequencing products we develop may not be approved by regulatory authorities or receive adequate reimbursement by payors, (iii) the possibility that the market for the sale of our sequencing products may not develop as expected, (iv) the risk that we will write down the value of our investment in Pacific Biosciences, (v) the risk that our ownership stake in Pacific Biosciences will be diluted by future financings, (vi) the risk that we may not be able to compete effectively, (vii) the risk that we may not be able to maintain our collaboration with Pacific Biosciences or enter into a further collaboration with them, (viii) the risk that our or Pacific Biosciences' intellectual property may be infringed by third parties or invalidated, and (ix) our involvement in patent and other intellectual property and commercial litigation could be expensive and could divert management's attention. This list includes some, but not all, of the factors that could affect our ability to achieve results described in any forward-looking statements. For additional information about risks and uncertainties we face and a discussion of our financial statements and footnotes, see documents we file with the SEC, including our most recent annual report on Form 10-K and all subsequent periodic reports. We assume no obligation and expressly disclaim any duty to update forward-looking statements to reflect events or circumstances after the date of this news release or to reflect the occurrence of subsequent events.