Please ensure Javascript is enabled for purposes of website accessibility

Investors cheer lab deal


  • By
  • | 11:00 a.m. October 30, 2015
  • | 2 Free Articles Remaining!
  • News
  • Share

When Douglas VanOort took the top job at cancer-testing firm NeoGenomics six years ago, he pledged to turn the company into the nation's premier oncology lab.

It looks like Fort Myers-based NeoGenomics is well on its way, with a blockbuster acquisition of rival Clarient from GE Life Sciences for $275 million in cash and stock. Investors cheered the combination, sending NeoGenomics stock up 28%, to as high as $7.29 a share when it announced the deal Oct. 21.

VanOort has a long track record of success in this business. As a top executive at Corning Life Sciences, he grew and spun off Quest Diagnostic into the largest independent clinical diagnostic company in the United States, with $1.5 billion in revenues in 1998.

NeoGenomics and Clarient provide hospitals and clinicians with cancer tests, but the biggest growth promise is helping pharmaceutical companies develop new cancer-treatment drugs and obtain government approvals. Once approved, NeoGenomics can develop companion tests that help physicians prescribe the most effective treatments.

GE Life Sciences, which will have a 32% ownership of the combined companies after the deal is completed later this year, is well-connected to major pharmaceutical companies.
“Those relationships will be important,” says Kieran Murphy, president and CEO of GE Healthcare Life Sciences, in a conference call with investors when the deal was announced.

Pharmaceutical companies are developing so-called “personalized” treatments that use a person's genetics to identify whether a specific drug will help them. “Some biologic drugs won't work with certain patients,” Murphy says. “Patients don't want to go through drug treatments that are ineffective.”

 

Latest News

×

Special Offer: $5 for 2 Months!

Your free article limit has been reached this month.
Subscribe now for unlimited digital access to our award-winning business news.
Join thousands of executives who rely on us for insights spanning Tampa Bay to Naples.