NeoGenomics Inc (NEO)

[apljack]

Updates of business developments.

Been rather quiet here, I doubt that NEO has garnered the attention it deserves but I also suspect that people will start to sit up and take notice as the business news starts to hit the street when the upside of new developments becomes clear. Here are some important milestone:

1. NEO inked a deal with PPD for strategic partnership:
Pharmaceutical Product Development, LLC (PPD), a leading global contract research organization (CRO), and NeoGenomics Laboratories, Inc., a leading provider of cancer-focused genetic testing services, are forming a strategic alliance to provide a seamless and fully integrated global pathology and molecular testing solution to PPD’s pharmaceutical and biotech clients.

As part of the collaboration, NeoGenomics will provide a wide range of lab testing services to support PPD® Laboratories’ oncology clinical trial activities in the U.S., Europe and Asia. Operationally, the collaboration will leverage NeoGenomics sites in the U.S. and Europe, and both companies expect to jointly invest in PPD’s existing labs in China and Singapore. The companies will provide an integrated global IT solution, leveraging PPD’s award-winning Preclarus® system to offer real-time visibility and analytics for informed decision-making.

Fully integrated with PPD’s CRO capabilities, PPD Laboratories offers the industry’s most comprehensive set of lab services, spanning bioanalytical, biomarkers, central lab, GMP and vaccine sciences. NeoGenomics provides one of the most comprehensive oncology-focused testing menus in the world to support physicians in the diagnosis and treatment of cancer and pharmaceutical clients in clinical trials and drug development.

The new collaboration focuses on centralized pathology review, as well as specialty lab services, including flow cytometry, fluorescence in situ hybridization (FISH), immunohistochemistry (IHC), cytogenetics, molecular assays, next-generation sequencing and MultiOmyx™, NeoGenomics’ proprietary, multi-omics multiplexing methodology.

Together, the companies also will provide clients a comprehensive companion diagnostics offering from biomarker discovery through regulatory approval and commercialization. Additionally, the teams are committed to leveraging their combined data assets to find more efficient methods of identifying appropriate patients for oncology trials.

PPD is a privately owned company so their finances are opaque, but consider they are global, wholly a CRO/drug development company with a considerable presence in both China and India, and have 20,000 employees, this deal could be huge. Read the details here:

https://finance.yahoo.com/news/ppd-neogenomics-forming-global-strategic-120000105.html

2. NeoGenomics Redeems 100% of Series A Redeemable Preferred Stock
NeoGenomics, Inc. (NEO) (the “Company”), a leading provider of cancer-focused genetic testing services, announced today that it redeemed 6,864,000 million shares of Series A Redeemable Preferred Stock (“Series A Preferred Stock”) held by an affiliate of General Electric Company for approximately $50.1 million. The shares were redeemed at approximately $7.30 per share, reflecting $7.16 per share, which is the applicable 4.5% redemption discount to the original liquidation preference, plus an additional $0.14 per share in respect of accrued and unpaid dividends for 2018. The Company has now redeemed 100% of the Series A Preferred Stock outstanding.

This has an obvious impact on share value as it reduces the outstanding share from about 80 million to about 66 million. At recent market cap value, this would put share value at about $16.67/share. The market doesn't always catch up (and may have already priced this reduction in) but I'm confident that there will be an upside to this move. Reading between the lines, the company executed this because their finances were strong enough to manage it and forward-looking anticipation of business is good.

Next quarter's CC will be exciting to here. Business is growing in a big way in the sector (CRO) that has the biggest margins.