A new chapter in genomics research

Clinical Data's Cogenics division goes to Beckman Coulter in a deal worth $17 million

Jeffrey Bouley
NEWTON, Mass.—Clinical Data Inc. completed the sale of Cogenics, the company's genomics services division, to Beckman Coulter Inc. for approximately $17 million in mid-April.
 
As had been previously announced, the sale achieves Clinical Data's goal "to monetize non-core assets and focus resources on advancing its two late-stage targeted therapeutic programs, each of which have anticipated near-term milestone events."
One of those events is to complete a second Phase III registration trial followed by a new drug application (NDA) filing for vilazodone, a first-in-class drug candidate for the treatment of depression. The other event is to begin a Phase III clinical program for Stedivaze, a cardiac stress agent for use in imaging that came to Clinical Data through its 2008 acquisition of Adenosine Therapeutics LLC, which performed the successful Phase II testing for the agent.

Theresa McNeely, vice president of corporate communications for Clinical Data, says that the results forthcoming from the first Phase III study for vilazodone are expected to be positive, and the company hopes to file the NDA before year's end. "With two Phase III therapeutics and earlier-stage drugs in the pipeline, we're positioned as a drug development company rather than the service model that Cogenics represented," she notes. "We've always been pretty clear that we ultimately wanted to focus on the therapeutic side of our business."

"This important transaction represents an integral part of our strategic plan to focus our resources on developing targeted therapeutics and advancing proprietary biomarker programs," says Drew Fromkin, president and CEO of Clinical Data. "We are confident that Beckman Coulter's Agencourt business, which is already widely recognized for high quality genomics services, will build upon the success of Cogenics in delivering the industry's most innovative solutions to a growing list of customers."

Cogenics' genomics solutions span current and next generation sequencing, gene expression, clinical and non-clinical genotyping, biomanufacturing support, nucleic acid extraction and biobanking for both research and regulated environments. Cogenics' customers include leading pharmaceutical and biotechnology companies, the U.S. National Institutes of Health agencies, government and academic researchers in the international life science community, and major agricultural companies and agencies.

What this means to Beckman Coulter—or, more specifically, Agencourt Bioscience Corp., which it owns and which will be bringing Cogenics into its fold—is that the company will be able offer a fuller range of integrated services for the research and regulated markets, says Julie Moore, director of strategic marketing for Agencourt.

"Agencourt has comprehensive sequencing services, and acquisition of Cogenics will add to those services with DNA extraction, genotype expression, cell banking and more," Moore notes. "What is also good is that Agencourt has been primarily in the academic market, whereas Cogenics was very focused on, and did a good job of, courting pharmaceutical companies."

At the closing, Beckman Coulter paid Clinical Data $15.4 million in cash after adjustments, with $2.5 million held in escrow for eighteen months. Clinical Data also retained approximately $2.2 million in cash from Cogenics immediately prior to the sale, resulting in net cash proceeds of $14.9 million. In exchange, Beckman Coulter acquired all of Cogenics' operations in the U.S., U.K., Germany and France.

The sale wasn't all that much of a surprise, ultimately. Back in February, Andrew Vaino, an analyst with Roth Capital Partners, noted in an interview with BioWorld Today, "My sense is that they will sell the Cogenics side of the business," as he pointed out that much of Clinical Data's value is tied to vilazodone, which Vaino, gave about a 60 percent of begin approved. One of the selling points of vilazodone is that a diagnostic test is associated with it, and "The so-called biomarker does give it a fairly substantial differentiation," Vaino said.

Vilazodone is notable, McNeely notes, for having a dual mechanism of action as both a selective serotonin reuptake inhibitor (SSRI) and a 5HT1A partial agonist that, which would make it a first-in-class product. The only other 5HT1A partial agonist on the market is 5HT1A partial agonist is buspirone for anxiety and the combination of two mechanisms of action should make an "interesting combination in terms of efficacy," McNeely says.

Jeffrey Bouley

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