WALTHAM, Mass., Jan. 5 /PRNewswire-FirstCall/ -- Inverness Medical Innovations, Inc. (NYSE: IMA), a global leader in enabling individuals to take charge of their health at home through the merger of rapid diagnostics and health management, announced today that it has entered into a distribution agreement with Epocal Inc. of Ottawa, Canada to distribute its epoc® Blood Analysis System for blood gas and electrolyte testing. The epoc (enterprise point of care) platform is a point-of-care analysis system which provides wireless bedside blood gas and electrolyte measurement testing solutions. Utilizing easy to use, low-cost disposable Smart- Cards™, the epoc System produces laboratory quality results in critical and acute care settings in about 30 seconds. The epoc system received FDA 510(k) clearance in 2006 for marketing in the US and anticipates receiving CE marking in 2010.
Under the five year agreement, Inverness will utilize its strong global sales force to promote the use of this point-of-care system co-exclusively with Epocal in all geographies worldwide, except for Japan, India, Bangladesh, Nepal, Bhutan and Sri Lanka. Inverness paid $20.0 million to Epocal in connection with the entry into the distribution agreement, which provides that Epocal will supply to Inverness, at no charge, all of Inverness' requirements for Epocal products and Inverness will pay to Epocal 50% of its revenues from the sale of Epocal products.
Separate from the distribution agreement, Inverness will work with Epocal in a collaboration to develop additional test menu content for the epoc testing platform, expanding Inverness' portfolio of test platforms in the point-of-care market. Inverness has also entered into a definitive agreement to acquire all of the issued and outstanding equity securities of Epocal for a total potential purchase price of up to $255 million, including a base purchase price of up to $172.5 million if Epocal achieves certain gross margin and other financial milestones on or prior to October 31, 2014, plus additional payments of up to $82.5 million if Epocal achieves certain other milestones relating to its gross margin and product development efforts on or prior to this date. The acquisition will also be subject to other closing conditions, including the receipt of any required antitrust or other approvals.
"The epoc platform, with its innovative blood gas and electrolyte solution, represents an exciting compliment in cardiology and emergency rooms to our Triage platform. Epocal's innovative test system and wireless connectivity solution set a new standard for the capability associated with point-of-care test offerings and an expandable platform onto which to introduce additional testing parameters for many years to come. Inverness will work closely with Epocal to develop new content for this state-of-the-art system for point-of-care testing," said Inverness CEO Ron Zwanziger.
Imants Lauks, PhD, President and Founder of Epocal, Inc. said today of the announcement: "The strategic partnership with Inverness, the world's leading provider of point-of-care testing, represents a significant milestone achievement for our company. This collaborative agreement expands the distribution and accelerates the market uptake of the best in class epoc System on a global scale."
About Inverness Medical Innovations
By developing new capabilities in near-patient diagnosis, monitoring and health management, Inverness Medical Innovations enables individuals to take charge of improving their health and quality of life. A global leader in rapid point-of-care diagnostics, Inverness' products, as well as its new product development efforts, focus on infectious disease, cardiology, oncology, drugs of abuse and women's health. Inverness is headquartered in Waltham, Massachusetts. For more information on Inverness Medical Innovations visit www.invernessmedical.com.
About Epocal, Inc.
Epocal, Inc., headquartered in Ottawa, ON, Canada with U.S. Sales and Marketing operations located in Horsham, PA, develops, manufactures and markets the epoc Blood Analysis System. epoc (enterprise point of care) is healthcare's first cost effective point of care testing solution to leverage SmartCard technology and the power of wireless communication to provide critical caregivers with real-time, laboratory quality test results at the patient's bedside. Additional information about the epoc System and Epocal, Inc. is available on the Company's website – www.epocal.com.
Cautionary Note Regarding Forward-Looking Statements
This press release may contain forward-looking statements within the meaning of the federal securities laws, including statements regarding the benefits of the distribution relationship and the potential acquisition of Epocal by Inverness. These statements reflect Inverness' current views with respect to future events and are based on management's current assumptions and information currently available. Actual results may differ materially due to numerous factors including, without limitation, risks associated with market and economic conditions, market acceptance of the epoc platform and current and future tests offerings for the system; Inverness' ability to market epoc products; Epocal's ability to manufacture and supply such products; the ability of the parties to work to together effectively to develop additional test content for the epoc platform; the ability of the parties to secure and maintain the regulatory approvals or clearances necessary to sell the product in various markets; the ability of the parties to meet the milestones and other conditions precedent to, and to complete, the potential acquisition of Epocal by Inverness; and the risks and uncertainties described in Inverness' annual report on Form 10-K, as amended, for the year ended December 31, 2008, and other factors identified from time to time in their respective periodic filings with the Securities and Exchange Commission. Inverness undertakes no obligation to update any forward-looking statements contained herein.