NeoGenomics Inc., a leading provider of cancer-focused genetic testing services, today announced that it has licensed the exclusive worldwide rights to use Health Discovery Corp.’s (HDC) intellectual property portfolio to develop laboratory developed tests (LDTs) and other products relating to hematopoietic and solid tumor cancers, excluding retina and breast cancer.
“Our agreement with HDC is an important strategic building block for NeoGenomics. We are executing well on the fundamentals of providing high-quality service, and have developed strong market-based partnerships with leading pathologists and clinicians. The ability to develop and successfully market innovative and proprietary genetic and molecular-based tests is an important third element of our strategy. This agreement provides the tools and resources necessary for NeoGenomics to execute on this essential strategic initiative,” Doug VanOort, chairman and CEO of NeoGenomics stated in the press release.
Per the agreement, NeoGenomics can develop and sell any gene, gene-product or protein-based LDT based on HDC’s technology. The agreement also gives NeoGenomics’ access to certain HDC personnel and consulting resources.
NeoGenomics paid $1 million in cash and issued 1,360,000 shares of common stock to HDC in upfront licensing fees. In addition, NeoGenomics will make milestone payments of $500,000 (up to $5 million) for every $2 million in revenue recognized by NeoGenomics based on products and services developed as a result of the licensing agreement. After NeoGenomics recognizes $20 million in cumulative revenue, NeoGenomics will pay a royalty of 6.5 percent on product sales and will share profits from sub-licensing arrangements.
VanOort said NeoGenomics will initially focus on development of LDTs for the detection of prostate, pancreatic and colon cancer. The company will also develop interpretation software targeted at automating cytogenetics and flow cytometry analysis.
“We have gained strong momentum in the marketplace over the past few quarters. Now, we are very focused on solidifying our gains and capitalizing on future opportunities available to us, VanOort concluded. “With demographic changes in our country driving a significant increase in the prevalence of cancer and the possibilities offered by personalized medicine, it is an ideal time for us to invest even more in new genetic test development.”
For more information visit http://www.neogenomics.com
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