Cambridge medical firm plans to float on AIM
A Cambridge medical diagnostics business setting new standards in the testing of at least 75 diseases is aiming for an AIM float in 2007 following a key acquisition in the East of England.Lab 21, backed by Merlin Biosciences, one of Europe’s leading European Life Sciences Venture Capital groups, has bought Newmarket Labs, another quality medical diagnostics business, for £4 million.
As well as targeting an IPO next year, it is also eyeing fresh acquisitions to accelerate critical mass. Lab 21 is a new, Cambridge based business providing an array of cutting edge technologies that produce rapid and accurate tests for some of the world’s most serious diseases.
Lab 21 already offers for sale more than 75 novel tests covering various cancers, liver diseases, virus diagnostics including HIV, Herpes, Hep C, West Nile, pharmacogenomics, respiratory, metabolic and neurological disorders as well as a huge range of human toxins and poisons.
The company has fully developed sophisticated bio-technology platforms from which it has not only launched the current novel tests but is expecting to launch a further 25 by the end of the year.
The company has already established a high level of credibility with over 70 international customers, in Europe, the US, Asia and Africa, for its current products and services. UK customers include leading hospitals such as The Royal Marsden Hospital, Sutton, Alderhay Hospital, Liverpool, the Cromwell and the Clinical Genetic Unit at Great Ormond Street.
The company has also established a significant reputation as a centre of excellence for preclinical pharmaceutical contracts as well as clinical trial support services.
Through the acquisition of NML, Lab 21 has acquired several new infectious disease tests including syphilis, malaria and TB – and over 70 new customers.
Although Lab 21 was only formed last year, it already has sufficient demand for its services to generate profitable growth on sales of over £8 million in 2007.
Merlin Biosciences reveals that Lab 21 is targeting a listing on AIM in 2007 to further establish its brand and raise capital for further acquisitions of profitable, leading edge diagnostic tests. Lab 21 was started with seed capital from Merlin in 2005 and Merlin’s highly successful Fund III still owns over 80 per cent of the shares.
Nick Kerton, founder and chairman of Lab 21 and formerly with Celsis International, said: “We have had tremendous support from Merlin and Chris Evans and this enabled us to make astonishing progress for a new, young business. We believe the acquisition of Newmarket Labs will accelerate the company’s growth as it seeks to become a world-class leader in the field of medical diagnostics.”
Jerry Walker, ex-Amersham International and now CEO of Lab 21 added: “Sir Chris at Merlin gave me the opportunity to lead this new and exciting business and within a year we have a superb range of products and services and an excellent international customer base.
“The acquisition of NML will accelerate our presence in the infectious diseases markets where we hope to launch yet more cutting edge tests in 2007. The enlarged group provides a unique range of cutting edge diagnostics aimed at the industrial and clinical markets.
“Lab 21’s products and services aim to shorten testing times with improved accuracy thereby increasing quality and bringing peace of mind to its customers.
“Lab 21 also aims to lower technical and commercial barriers thereby making testing more accessible. The acquisition of NML is only the beginning and we have a number of complementary businesses already under review.”
Sir Chris Evans, chairman of Merlin Biosciences said: “I am proud to have contributed to the creation of such a promising young company as Lab 21. It has assembled a lot of top quality people and has some amazing science underpinning its vast array of tests.
“Like all venture capitalists, I am delighted to see their ever growing customer base and excellent sales growth and I’m pleased that yet another of our Merlin Fund III portfolio companies has burst onto the scene like this.”