Interactions Has the Potential to Affect Scientific Techniques
in a Sweeping Manner
WEST BRIDGEWATER, Mass., Oct. 14 /PRNewswire/ -- Boston Biomedica Inc. (Nasdaq: BBII) announced today that it has acquired all of the remaining outstanding capital stock of BioSeq Inc., a privately held development stage company (Woburn, Mass.) with 16 patent applications covering a proprietary technology for the precise, instantaneous control of molecular interactions. The company will now be called BBI BioSeq.
Boston Biomedica purchased the remaining stock of BioSeq for $1,000,000 in cash and Warrants to purchase 100,000 shares of BBI stock at the September 30, 1998 closing price of $2.50 per share. BBI also exchanged options to purchase approximately 54,000 shares of BBI stock for outstanding BioSeq options, and assumed approximately $730,000 of BioSeq debt. The Company's total cost for the purchase of BioSeq was approximately $4,000,000, which includes the purchase price, acquisition costs, assumption of indebtedness and its original 19 percent investment in BioSeq. Management believes that all or a significant portion of this total cost may be expensed as in-process research and development in the third quarter ending September 30, 1998.
In connection with the purchase, BBI agreed to assume a modified technology transfer agreement with Biomolecular Assays Inc. d/b/a/ BMA Labs (Woburn Mass.) (BMA), the original inventor of the BioSeq technology. This agreement calls for a total minimum royalty payment of $500,000 to BMA, beginning immediately and payable over the next five years. In addition, BMA entered into a non-exclusive license agreement with BBI BioSeq for the research market.
"BioSeq's technology enables instantaneous manipulation of biomolecules and has the potential for numerous and significant applications in human and veterinary diagnostics, in the inactivation of microorganisms in blood plasma and plasma products, and in many other areas of biomolecular analysis," said Richard T. Schumacher, Founder and Chief Executive Officer of Boston Biomedica.
BBI BioSeq is currently establishing a collaboration with CBR Laboratories, Inc., a wholly owned subsidiary of the Center for Blood Research, Inc. of Boston, MA, a Harvard Medical School affiliate. According to Dr. William McCormick, Vice President for Scientific and Regulatory Affairs of the Center, "BioSeq's proprietary technology appears to hold the promise of having broad applicability for the preparation of safe blood plasma-derived products as well as other preparations for intravenous therapy and injection that require the elimination of potential pathogenic microorganisms. Findings to date to validate BioSeq's technology for the destruction of viruses have been sufficiently encouraging to proceed with the development of the technology for the preparation of a number of products intended for human use."
"This acquisition is an excellent fit for us," explained Schumacher. "BBI is a diversified diagnostics company with access to financial resources, broad-based scientific and manufacturing expertise, and the industry contacts necessary to fast-forward the commercialization of BioSeq's technology. Our research subsidiary (BBI Biotech) will work with the BBI BioSeq scientists to develop the many potential applications, our instrument subsidiary (BBI Source Scientific) will design and build the instrumentation; and our specialty laboratory subsidiary (BBI Clinical Laboratories) will offer unique testing services using this novel process. We expect this powerful corporate-wide synergy, together with significantly increased R&D spending, to provide initial commercialization of this technology within the next twenty-four months."
"We are fortunate that our primary customer base for our core business line (quality control products) is essentially the same customer base that will benefit the most from the BioSeq technology; that is, diagnostics companies, blood banks, regulatory agencies and clinical laboratories", added Barry M. Warren, Sr. VP of Marketing and Sales for BBI. "With both our direct sales force and worldwide distribution network already in place, we eagerly look forward to the development of BioSeq technology-driven products."
"Because BioSeq's technology operates on a fundamental level, it has the potential to be an enabling platform in a broad number of markets," said James A. Laugharn, former President and CEO of BioSeq. "Once fully developed, this technology could offer numerous commercial advantages over existing methods to control biomolecular interactions, including the major benefits of higher speed, simplicity of operation, and lower cost."
Under the acquisition agreement, Mr. Laugharn will serve as a consultant to Boston Biomedica for one year, in order to ensure the successful transfer of the technology to BBI. Several of BioSeq's key scientists have accepted positions with Boston Biomedica.
BioSeq's "pressure-cycling" technology is based on its discovery that biological and non-biological molecular interactions can be closely controlled by repeatedly cycling between relatively high and low pressures. Traditionally, analytical or manufacturing processes are controlled using temperature change or chemical reactions, both of which can be more difficult to modulate rapidly, repeatedly and precisely.
BioSeq's broad-based technology platform offers the potential for a number of commercial applications, including the sterilization or decontamination of blood plasma and plasma products by the inactivation of microorganisms, the purification of nucleic acids (DNA or RNA) in preparation for molecular diagnostics testing, and the control of antigen-antibody reactions in immunoassay.
Boston Biomedica Inc. is a worldwide manufacturer and provider of proprietary quality control products for use with IVD test kits for the detection, analysis and monitoring of infectious diseases, including AIDS, Hepatitis, Lyme Disease and ToRCH. The Company's products are used by clinical and research laboratories, blood banks, and IVD manufacturers to help ensure the accuracy of infectious disease test results through the routine monitoring of test performance. The Company also manufactures diagnostic test kit components and laboratory instrumentation, and provides specialty laboratory testing and contract research services.
Statements contained in this news release that state the Company's or
management's intentions, hopes, beliefs, expectations or predictions of the
future are "forward-looking" statements. It is important to note that the
Company's actual results could differ materially from those projected in such
forward-looking statements. Factors that could cause actual results to differ
from those projected include the possibility that due to unforeseen technical,
financial and other difficulties BBI BioSeq may not be able to develop its
technology into commercially successful products, or such development may take
longer than currently expected. There can be no assurances that BBI BioSeq
will be successfully integrated into Boston Biomedica's overall operations.
Additional information concerning factors that could cause actual results to
differ materially from those in the forward-looking statements is contained
from time to time in the Company's SEC filings, including but not limited to
the Company's report on Form 10-Q for the period ended June 30, 1998. Copies
of this document may be obtained by contacting the Company or the SEC.
SOURCE Boston Biomedica Inc.
CONTACT: Richard T. Schumacher, Pres./CEO or Kevin W. Quinlan, CFO of Boston Biomedica, Inc., 508-580-1900, or Maribel Lopez, ext. 12, or Jon Siegal, ext. 15, of Ronald Trahan Associates, Inc., 617-332-0101