DGX - Quest to acquire cancer detection test maker Haystack in all cash deal

2023-04-27 08:35:38 ET

• Quest Diagnostics ( NYSE: DGX ) is acquiring Haystack Oncology in an all-cash equity deal.
• Quest will pay Haystack — which is focused on minimal residual disease (MRD) testing for detection of residual or recurring cancer —  $300M in cash at closing, net of cash acquired, and up to an additional $150M on achieving future performance milestones.
• Haystack has developed a ctDNA-based technology specifically for MRD detection. Quest expects to adapt the MRD test as the basis for new clinical lab services available starting in 2024. Development efforts will initially be aimed at MRD tests for colorectal, breast and lung cancers.
• "Haystack's liquid biopsy technology, combined with Quest's strengths in screening, pathology and sequencing, will now position us to lead in the fast-growing MRD category," said Quest's Chairman, President and CEO Jim Davis.
• Quest expects the acquisition to be modestly dilutive to earnings over the next three years and accretive by 2026.
• The deal is expected to be completed in Q2, subject to regulatory review.
• DGX +0.79% to $148 premarket April 27

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