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NeoGenomics Buys Ex-Novartis Cancer Lab Genoptix for $125M, Stock

Xconomy San Diego — 

Cancer testing laboratory Genoptix is being acquired by NeoGenomics, another cancer-focused genetic testing business, for $125 million in cash and 1 million NeoGenomics shares.

The buyout comes almost two years after Carlsbad, CA-based Genoptix was bought from Novartis (NYSE: NVS) by a pair of private investment firms, Ampersand Capital Partners and 1315 Capital, and a management group for an undisclosed sum in January 2017. Joseph Limber became the CEO of the company. Limber previously held roles at Prometheus Pharmaceuticals in San Diego, which sold to Nestlé Health Science, and Gradalis, a Dallas-based life sciences startup.

Genoptix specializes in hematology and solid tumor testing. Fort Myers, FL-based NeoGenomics said the acquisition will expand its coverage of oncology practices and provide it with helpful relationships to those businesses.

While it’s unclear whether Genoptix’s most recent owners will profit or not from the sale, the $125 million price tag is far below the $470 million Novartis paid in 2011, when Genoptix was publicly traded. Part of that difference is made up by the fact that the 2017 sale didn’t include Genoptix’s biopharma research and development division, which Novartis retained and renamed Navigate BioPharma Services. As Xconomy reported in 2011, Novartis was the world’s second-largest cancer drug maker, in large part thanks to its leukemia treatment imatinib (Gleevec). Blood cancer was one of Genoptix’s specialties, and Novartis expected the acquisition to boost its use of “companion diagnostics”—tests that confirm a patient’s cancer should be treated with a specific drug.