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CytoBiosciences Buys Fellow Targeted Tech Company BioDTech for Stock

Xconomy Texas — 

San Antonio — One portfolio company of investment firm Targeted Technology is acquiring another.

San Antonio-based CytoBioscience, through its parent company, is buying BioDtech, a Birmingham, AL-based maker of technology for detecting and removing endotoxins, toxins that are carried within the cell walls of certain bacteria and associated with various types of infections, according to a securities filing. WestMountain Co., which became the parent of CytoBioscience in March, made a verbal agreement to issue almost 2.5 million shares of its stock to the owners of BioDtech to acquire the business. The deal is valued at $1.85 million, according to the filing.

San Antonio-based Targeted Technology invested in BioDtech in 2010 and CytoBioscience in 2016, according to its website. Founded in Germany, CytoBioScience moved to San Antonio in 2015. It sells a device, the CytoPatch, for screening the safety and efficacy of drug formulations, as well as various other medical tools, to researchers. BioDtech was founded in 2003.

Meanwhile, WestMountain is seeking to change its name to InventaBioTech to reflect its role in selling research instrumentation and as a contract research organization, according to a second securities filing. WestMountain, which is traded on the over-the-counter public markets under the ticker “WASM” and was previously based in Fort Collins, CO, merged into CytoBioscience in March, and CytoBioscience CEO Jim Garvin became the business’s CEO.

In addition to the name change, WestMountain is also considering a reverse stock split in order to increase its share price as it considers applying to have its common stock listed on NASDAQ, according to the securities filing. Bloomberg and Yahoo list the stock’s price at 25 cents per share. The company has about 54.8 million outstanding shares, and Targeted Technology owns almost 23.7 percent of them, according to the filing.

The company also announced that a fund associated with New York-based investment firm FirstFire Capital purchased a convertible note and common stock warrants for $200,000.

CytoBioscience acquired another Birmingham-based screening company, Soluble Therapeutics, in late 2016 in what Garvin told Xconomy was a multi-million dollar deal. CytoBioscience planned to change the company’s name to Soluble Biosciences and move it to San Antonio. BioDtech, meanwhile, will keep its name and remain in Birmingham, Garvin told the San Antonio Business Journal, which first reported the acquisition this morning.