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Chembio to expand its infectious diseases operations with Orangelife
Posted on Friday, 08 November 2019 14:19
Chembio Diagnostics has agreed to buy Brazilian diagnostic test manufacturer and distributor Orangelife Comercio e Industria in a transaction due to close during the fourth quarter of 2019.

The acquiror is offering an upfront payment of USD 150,000 in cash and 153,707 shares of common stock.

Furthermore, the deal also includes an earnout of 497,288 common shares dependent on certain sales and regulatory targets being achieved between 2020 and 2022.

The purchase remains subject to customary closing conditions.

Orangelife will be renamed Chembio Diagnostics Brazil and operate as a wholly-owned subsidiary of the acquiror following the completion of the deal.

The target manufactures a range of point-of-care infectious disease tests approved by the National Sanitary Surveillance Agency (ANVISA).

Orangelife operates from its Rio de Janeiro-based facility, which has been certified by the International Organisation for Standardisation and cleared by ANVISA to produce class II, III and IV medical devices.

The group’s offering includes a self-test kit for the human immunodeficiency virus, more commonly known as HIV, which is the first of its kind in Brazil.

New York-headquartered Chembio focuses on the development, manufacture and commercialisation of diagnostic test services.

Through its partner Bio-Manguinhos, an arm of the Brazilian government, the buyer has been selling its products to the country’s Ministry of Health since 2004.

John Sperzel, chief executive of the purchaser, said: “We consider Brazil to be the largest and most attractive market for infectious disease testing.

“The acquisition of Orangelife will allow Chembio to expand its commercial presence by offering its high-quality products to the state, private, and pharmacy markets in Brazil, in addition to providing local support to Bio-Manguinhos.”

For the nine months ended 30th September, the buyer generated revenue of USD 27.61 million, up 2.9 per cent from USD 26.81 million in the corresponding period of 2018.

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