Konica Minolta has agreed to acquire Ambry Genetics for up to $1 billion, the companies said today, in a deal the buyer envisions as the first step in its strategy of developing a leading presence in precision medicine.
Founded in 1999, privately-held Ambry says it has performed more than one million genetic tests and identified more than 45,000 mutations in at least 500 different genes since it began offering hereditary cancer panels and clinical exome sequencing. The company offers genetic testing solutions for inherited and non-inherited diseases, as well as for numerous clinical specialties, including oncology, cardiology, pulmonology, neurology, and general genetics.
Konica Minolta reasons that it can create the most comprehensive range of healthcare diagnostics for pharmaceutical companies, healthcare providers, payers, and consumers by marrying its advanced imaging technology with Ambry’s genetic testing capabilities.
Two years ago, Konica Minolta pioneered an advanced immunostaining technology called High-Sensitivity Tissue Testing (HSTT), which uses fluorescent nanoparticles to detect and quantify the proteins that drive disease states, with the goal of offering greater precision and accuracy than conventional immunostaining techniques. Initially applied in oncology, HSTT is designed to determine the exact cellular location and amount of specific proteins in cells, enabling early-stage, precise diagnosis and insights into a patient’s disease designed to inform research and clinicians’ treatment plans.
“We’re providing this technology to drug discovery and clinical trial programs, but ultimately we would like to develop a testing and diagnostic business for functional contrast agents and induced pluripotent cells,” Kunihiro Koshizuka, senior executive officer at Konica Minolta, stated on the company’s website.
Konica Minolta says HSTT will be further enhanced by Ambry’s genetics-based screening techniques, which enable clinicians to analyze both tumor and normal tissue to diagnose hereditary cancer, while also providing guidance regarding drug eligibility and response. Ambry recently launched a combined genetic test for both inherited and acquired mutations in DNA mismatch repair genes to indicate appropriate treatment options for cancer patients who may benefit from PD-1/PD-L1 immunotherapy.
In acquiring Ambry, Konica Minolta has signaled a shift in the focus of its healthcare business from imaging and other technologies and services. In addition to innovations in materials science, nanofabrication, and optics, Konica Minolta’s healthcare offerings include digital X-ray diagnostic imaging systems, diagnostic ultrasound systems, and ICT service platforms for medical institutions.
“This acquisition is the first in a series of strategic initiatives to secure a leading position for Konica Minolta in precision medicine”, said Shoei Yamana, president and CEO of Konica Minolta. “This will not only serve as the future foundation for our healthcare business, but will pave the way for a fundamental shift in the way medicine is practiced globally.”
Added Charles Dunlop, Ambry’s president and chairman: “As a part of Konica Minolta, we will have the resources, technology, and scale to advance biomedical research and enable the matching of more patients in more countries with specialized medicines that target the underlying cause of their illness.”
Konica Minolta says it plans to bring Ambry’s capabilities first to Japan, then to Europe.
“In addition to introducing Ambry’s genetic-testing capabilities to the Japan market, we will look to develop new bio-imaging and proteomic services and solutions to benefit doctors, patients, and pharmaceutical companies,” stated Kiyotaka Fujii, senior executive officer, president, global healthcare, Konica Minolta. “The combination of these bioinformatics capabilities, alongside Konica Minolta’s HSTT technology, will create new opportunities for drug discovery and clinical trials not currently available.”
A wholly-owned Konica Minolta subsidiary, Konica Minolta Healthcare Americas (MHUS), will join with the public-private Innovation Network Corporation of Japan (INCJ) to shell out $800 million for Ambry at the close of the deal, which is expected in October, subject to customary regulatory approvals. MHUS will invest 60% and INCJ, 40%.
MHUS and INCJ also agreed to give Ambry shareholders up to an additional $200 million tied to achieving undisclosed financial metrics over the next two years.
Upon the close of the transaction, Ambry would continue to operate under its own name as a consolidated subsidiary of Konica Minolta, and would remain headquartered in Aliso Viejo, CA.