Waukesha biotech firm Prodesse sold for $60 million
Prodesse Inc., a Waukesha biotech firm, has been sold to Gen-Probe Inc. in San Diego for $60 million, Gen-Probe said Tuesday.
Gen-Probe expects the acquisition to boost revenue by giving its sales force additional products to promote around the world.
Prodesse makes tests used to diagnose diseases, including influenza. The company is owned by 35 people, including a Medical College of Wisconsin professor and other founders and investors.
Gen-Probe, a publicly held company that employs 1,200 people, makes tests used to diagnose diseases and screen donated human blood.
The sale has been approved by the boards of both companies and is expected to close within a month. The agreement provides for additional payments of up to $25 million if Prodesse achieves certain financial and regulatory milestones in 2010 and 2011.
Prodesse was founded in 1996, and obtained $1.5 million in funding in 2002. Shamrock Partners, headed by Tom Shannon, was the lead investor.
Shannon, who is now president and chief executive officer, said in an interview that he would remain with the company through the transition. Prodesse will remain in Waukesha and Gen-Probe has said it plans to retain Prodesse's staff of 24.
"We believe that investors are receiving a considerable return on their investment," Shannon said.
The company sells the only commercially available FDA-approved molecular test for influenza A and B viruses and respiratory syncytial virus that use PCR, or polymerase chain reaction, technology. Results can be obtained in as little as three hours. H1N1 swine flu is a subtype of influenza A virus.
"This is a validation that the ideas are here," Shannon said.
Gen-Probe plans to fund the transaction with cash currently on its balance sheet.
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