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Invitae and ArcherDX to create a global leader in comprehensive cancer genetics and precision oncology

Combination to bring germline and somatic testing, liquid biopsy and tissue genomic profiling onto a single platform to offer patients a full suite of cancer testing for risk, therapy optimization and personalized cancer monitoring.

Provides unrivaled breadth and flexibility for clinicians, democratizing the use of genetics in routine care worldwide.

SAN FRANCISCO and BOULDER, COLO., June 22, 2020 — Invitae (NYSE: NVTA), a leading genetics company, and ArcherDX, a leading genomics analysis company democratizing precision oncology, today announced the companies have entered into a definitive agreement under which Invitae will combine with ArcherDX to create a genetics leader with unrivaled breadth and scale in cancer genetics and precision oncology.

The combined company will be poised to transform care for cancer patients, accelerating adoption of genetics through the most comprehensive suite of products and services available. Integrating germline testing, tumor profiling and liquid biopsy technologies and services in a single platform will enable precision approaches from diagnostic testing to therapy optimization and monitoring, expanding access to best-in-class personalized oncology.

“From the beginning, Invitae’s goal has been to aggregate the world’s genetic tests into a single platform in service of our mission to bring comprehensive genetic information into mainstream medicine. Today, we take another major step forward in that effort,” said Sean George, Ph.D., co-founder and chief executive officer of Invitae.

“ArcherDX and Invitae share a foundational belief in the power of genomic information to impact care. We are thrilled to unite with Invitae to form the leading hub for precision oncology, diagnostics, therapy optimization and monitoring, with an opportunity to accelerate both patient care and shareholder value,” said Jason Myers, Ph.D., chief executive officer and co-founder of ArcherDX. “ArcherDX was founded to democratize precision oncology with best-in-class products that are personal, actionable and available in local care settings. We see STRATAFIDE DX™ as a significant near-term value driver, currently under development for cancer therapy optimization, while PCM™ provides an exciting opportunity to transform cancer care through multiple monitoring applications. ArcherDX products, workflow and powerful bioinformatics solutions provide an opportunity to advance precision oncology into regional and community settings and address an estimated $45 billion market opportunity. Together with Invitae, we look forward to expanding our impact beyond oncology, driving significant value through shared expertise to inform healthcare throughout life, globally.”

“Integrating all aspects of cancer genetics can transform care for patients and the flexibility that comes from both centralized and decentralized capabilities will uniquely position Invitae to meet the needs of customers worldwide,” continued Dr. George. “By joining together, we will unite world-class capabilities in the hands of a talented team with complementary expertise and strong brands in service of a shared goal to improve healthcare for patients.”

Accelerating access and adoption of genetics to improve cancer care

Broad adoption of precision oncology has been limited, particularly in regional and community settings where approximately 85 percent of patients receive care. Without precision oncology, late-stage cancer patients can suffer from poor prognosis and outcomes, while early-stage patients may receive an inaccurate prognosis that results in unnecessary treatment and delayed detection of recurrence. ,

Uniting Invitae and ArcherDX will offer comprehensive support for precision oncology.

  •  Invitae has quickly become a leader in diagnostic and hereditary risk testing and has strong relationships with clinicians caring for cancer patients, including cancer genetic counselors, oncologists and imaging centers.
  • ArcherDX’s platform, with its proprietary Anchored Multiplex PCR (AMP™) chemistry at the core, has enabled it to develop industry-leading products and services under investigation to optimize therapy and enable cancer monitoring across liquid and tissue samples.
  •  ArcherDX has developed and commercialized over 325 unique products, including research products and services in use by more than 300 laboratories worldwide and has collaborated with more than 50 biopharmaceutical companies and contract research organizations (CROs), providing services that enable biopharmaceutical companies, including partners such as AstraZeneca, BMS and Bayer, to cost-effectively accelerate drug development.
  • ArcherDX is also currently developing in-vitro diagnostic (IVD) products, including STRATAFIDE DX, for therapy optimization, an estimated $5 billion market opportunity with U.S. Food and Drug Administration (FDA) submissions planned this year, and the broadly applicable Personalized Cancer Monitoring (PCM) in development for disease recurrence monitoring, therapy optimization including selection, response and modulation. Both STRATAFIDE DX and PCM have received Breakthrough Device designation from the FDA.
  • Together, the company will be ideally positioned to serve customers across the continuum, from individuals and community clinicians to biopharmaceutical partners, distribution partners, reference laboratories and academic centers. Invitae’s central laboratory provides support for customers who prefer to send out and can benefit from a full suite of services including reporting, clinician consultation and genetic counseling for patients, while ArcherDX’s decentralized model supports geographies and customers where local control of patient reporting is either desired or required.

With both centralized and local testing capabilities, the combined organization will offer breadth and flexibility in serving customers in more than 95 markets. Together, Invitae and ArcherDX will offer robust support for biopharmaceutical companies, from patient identification and screening, to biomarker identification and companion diagnostic development.

Transaction Terms

Under the terms of the agreement, Invitae will acquire ArcherDX for upfront consideration consisting of 30 million shares of Invitae common stock and $325 million in cash, plus up to an additional 27 million shares of Invitae common stock payable in connection with the achievement of certain milestones, for an overall transaction valued at approximately $1.4 billion. The transaction, which has been unanimously approved by the Boards of Directors of both companies, is expected to close in several months, subject to customary closing conditions including approval by the stockholders of Invitae and ArcherDX.

Financing Activities

In connection with the proposed combination, Invitae has arranged a strategic financing with over $400 million in financing commitments from a premier syndicate of life sciences investors, led by Perceptive Advisors. Invitae has entered into a definitive agreement to sell $275 million in common stock in a private placement at a price of $16.85 per share. The private placement is being supported by key existing investors in Invitae and Archer, including Casdin Capital, Deerfield Management, Driehaus Capital Management, Farallon, PBM Capital, Perceptive Advisors, Redmile Group, Rock Springs Capital, Soleus Capital, and one additional institutional investor. The placement is expected to close concurrently with the proposed combination, subject to the satisfaction of customary closing conditions. Invitae has also entered into a fully committed credit facility for up to $200 million with Perceptive Credit Opportunities Funds, subject to certain customary closing conditions. Since the filing of its Quarterly Report on Form 10-Q for the quarter ended March 31, 2020, Invitae has sold under its ATM facility approximately 2.6 million shares of common stock for aggregate gross proceeds of $46 million at an average price of $17.59 per share. Invitae’s current expectations regarding its cash at transaction close would be approximately $425 million and its annualized near-term forward cash burn is expected to be approximately $130 million.

Author / sources: Invitae / https://ir.invitae.com/news-and-events/press-releases/press-release-details/2020/Invitae-and-ArcherDX-to-create-a-global-leader-in-comprehensive-cancer-genetics-and-precision-oncology/default.aspx

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