Madison-based biotechnology company Exact Sciences Corp. has orchestrated another billion-dollar deal, this time acquiring Cambridge, Massachusetts-based cancer detection company Thrive Earlier Detection Corp. in a cash and stock deal valued at $2.15 billion.
The company also announced Tuesday it had acquired Cambridge, England-based Base Genomics for $410 million. Base Genomics is a company working in DNA methylation analysis.
The acquisitions are the company's fourth and fifth in the last two years and largest since its acquisition of California’s Genomic Health in a cash and stock deal valued at $2.8 billion in 2019.
In a news release Tuesday, Exact Sciences (Nasdaq: EXAS), which makes the Cologuard colon cancer take home test, said the acquisition of Thrive is anticipated to close during the first quarter of 2021, subject to regulatory approval and the satisfaction of other conditions.
“The acquisition of Thrive is a giant leap toward ensuring blood-based, multi-cancer screening becomes a reality and eventually, the standard of care. We couldn’t be more excited that Exact Sciences will be at the forefront of this incredible opportunity to serve patients,” said Kevin Conroy, chairman and CEO of Exact Sciences, in a statement.
“We have long respected the Thrive team for their rigorous scientific approach, having participated in both funding rounds as an investor. We are proud to take our partnership to the next level by leveraging Exact Sciences’ established R&D team and highly accurate testing platform to augment development of CancerSEEK and accelerate its commercialization. By combining the expertise of both organizations, we believe we can bring this powerful technology to patients faster.”
Under the terms of the agreement, Thrive will receive total consideration of up to $2.15 billion, of which $1.7 billion would be payable at closing, comprised of 65% in Exact Sciences common stock and 35% in cash, subject to certain adjustments, the company stated. An additional $450 million would be payable based on reaching certain milestones.
Earlier this year, Thrive raised $257 million from private investors, including Exact Sciences. Exact Sciences initially invested in Thrive in early 2019, when the company launched with $110 million in Series A funding round. Thrive's CancerSEEK was designed to detect pieces of tumor DNA and proteins associated with different types of cancers.
“Thrive is driven by the knowledge that if cancer is caught early enough, it can be more effectively treated or even cured, and every patient deserves a chance for a better outcome.” said David Daly, CEO of Thrive.
“Our team has made significant progress toward our mission and we are eager to collaborate with and benefit from Exact Sciences’ expertise, and believe that together we will enable broader, quicker adoption of our test. With the support of our ongoing partnership with Johns Hopkins University, we are energized to contribute meaningfully to our shared mission of advancing the fight against cancer and providing life-changing answers to patients in need.”
Exact Sciences reported third quarter revenue of $408.4 million, compared with $218.8 million in the year-ago quarter. Revenue generated in the third quarter included cancer-screening revenue of $214.6 million, precision oncology revenue of $91.6 million, and Covid-19 testing revenue of $102.2 million. The company posted cash, cash equivalents, and marketable securities of $1.3 billion for the quarter.
The company also reported a net loss was $219.9 million, or $1.46 per share. The company's stock was trading up nearly 5 percentage points at $111.51 before the market opened early Tuesday morning.
Exact Sciences had fiscal 2019 revenue of $876.3 million, which included revenue from Genomic's precision oncology business from the Nov. 8 closing date through Dec. 31, 2019.
