On July 20, 2021, Pacific Biosciences of California (PacBio), a leading provider of high-quality, long-read sequencing platforms, announced that it has signed a definitive merger agreement to acquire Omniome, a San Diego-based company developing a highly differentiated, proprietary short-read sequencing platform capable of delivering high accuracy. Upon closing of the acquisition, PacBio will be uniquely positioned as the only company with both highly accurate long-read and short-read sequencing platforms. The company also announced two other transactions: a private placement for aggregate proceeds of approximately $300 million in connection with the proposed acquisition, and an intent to expand a multi-year collaboration with Invitae Corporation to develop a production-scale high-throughput HiFi sequencing platform to include the sequencing technology developed by Omniome.
Under the terms of the acquisition agreement, PacBio will acquire Omniome for upfront consideration of approximately $600 million, consisting of 9.4 million shares of PacBio common stock and $300 million in cash, plus an additional $200 million in cash and stock payable in connection with the achievement of certain milestones, for an overall transaction valued at approximately $800 million. The transaction is expected to close later this quarter, subject to customary closing conditions and regulatory approvals.
In connection with the proposed acquisition, PacBio has entered into a definitive agreement to sell approximately 11.2 million shares of PacBio common stock in a private placement transaction at a price of $26.75 per share, for aggregate gross proceeds to PacBio of approximately $300 million, with commitments from a premier syndicate of life sciences investors. The closing is subject to customary closing conditions, as well as the closing of the Omniome acquisition.
PacBio's expansion of its collaboration with Invitae is expected to add the short read sequencing technology enabled by Sequencing by Binding (SBB) chemistry upon close of PacBio’s proposed acquisition of Omniome, and contingent upon PacBio’s and Invitae’s agreement of associated terms. Omniome’s novel and highly differentiated sequencing technology promises significant improvement in raw base accuracy over traditional next generation sequencing products enabling the potential for more precise and sensitive molecular diagnostics. PacBio and Invitae intend to work together to leverage the improved accuracy and sensitivity of SBB chemistry to further advance cancer diagnostics and pathogen detection. Additionally, the parties intend to work together to explore novel methods of integrating SBB chemistry with PacBio’s HiFi genomes.
A Wilson Sonsini Goodrich & Rosati team, led by Donna Petkanics, advised PacBio on the above transactions. Donna has led Wilson Sonsini's efforts as counsel for PacBio on various other deals, including its proposed 2018 acquisition by Illumina, a follow-on offering in August 2020, another follow-on offering in November 2020, its initial collaboration agreement with Invitae in January 2021, and a major investment from SoftBank in February 2021.
The Wilson Sonsini team that advised PacBio on its transactions announced on July 20, 2021, includes:
Corporate
Martin Korman
Donna Petkanics
Andrew Hoffman
Douglas Schnell
Jonathan Chan
Dennise Martinez
Emily Chan
Abhinaya Prithivi
Employee Benefits and Compensation
Scott McCall
Jaqueline Tokuda
Jason Chan
Intellectual Property
Ian Edvalson
Shefali Tandon
Karen Wong
Adrian Barker
Bo Chen
Brandon Tavshanjian
Adam Cole
Tax
Myra Sutanto Shen
Andrew Bryant
Antitrust
Michelle Yost Hale
Regulatory
David Hoffmeister
Eva Yin
Export Control/CFIUS
Joshua Gruenspecht
Anne Seymour
Kara McDonough
Real Estate
James McCann
Martin Sul
Employment Litigation
Rebecca Stuart
Nedim Novakovic
Privacy and Cybersecurity
Matthew Staples
Daniel Chen
For more information, please see PacBio's press releases on the Omniome acquisition and related private placement and the company's intention to expand its agreement with Invitae.