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Invitae Corp. Enters into Definitive Agreement to Acquire ArcherDX

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Shares of Invitae Corp. traded 40% higher after the company reported it will acquire ArcherDX in a combination cash and stock deal valued at around $1.4 billion.

Advanced medical genetics company Invitae Corp. (NVTA:NYSE) and genomics analysis firm ArcherDX today announced that "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 firms indicated that the combined entity will be positioned strongly to transform cancer patients' overall care. The companies stated that the merger will integrate germline testing, tumor profiling and liquid biopsy technologies and services in a single platform, which will facilitate precision personalized oncology approaches from diagnostic testing to therapy optimization and monitoring. The combined organization's centralized and local testing capabilities will service customers in more than 95 markets.

Invitae's co-founder and CEO Sean George, Ph.D., commented, "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."

Jason Myers, Ph.D., CEO and co-founder of ArcherDX, remarked, "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...ArcherDX was founded to democratize precision oncology with best-in-class products that are personal, actionable and available in local care settings...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."

Invitae's Dr. George added, "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...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."

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 companies advised that the transaction, which is subject to customary closing conditions including approval by the stockholders of Invitae and ArcherDX, has already been unanimously approved by the boards of directors of both companies and is expected to close in several months.

Invitae Corp. is a medical genetics company based in San Francisco. The company listed that "its mission is to bring comprehensive genetic information into mainstream medicine to improve healthcare for billions of people." The firm is focused on strives to aggregating the world's genetic tests into a single service with quicker turnaround, higher quality and lower prices.

ArcherDX is headquartered in Boulder, Colo., and was described in the new release as "a leading genomic analysis company democratizing precision oncology through a suite of products and services that are highly accurate, personal, actionable and easy to use in local settings." The firm develops and commercializes research products which are later integrated into in vitro diagnostic (IVD) products. The company has IVD products currently in development for solid tumor biomarker identification and Personalized Cancer Monitoring.

Invitae Corp. started off the day with a market capitalization of around $2.3 billion with approximately 125.0 million shares outstanding and a short interest of about 16.7%. NVTA shares opened nearly 18% higher today at $22.02 (+$3.31, +17.69%) over Friday's $18.71 closing price. The stock has traded today between $21.50 and $27.77 per share and is currently trading at $26.69 (+$7.98, +42.65%).

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