Science & Technology
Science and Technology
Science and Technology
Tue, January 4, 2011
Mon, January 3, 2011
Fri, December 31, 2010
NASHUA, N.H.--([ BUSINESS WIRE ])--iCAD, Inc. (NASDAQ:ICAD), an industry-leading provider of advanced image analysis and workflow solutions for the early identification of cancer, has completed the previously announced acquisition of Xoft, Inc., developer of the Axxent® eBxa" electronic brachytherapy system. The portable Axxent System, which delivers electronically-controlled radiation therapy directly to cancer sites with minimal radiation exposure to surrounding healthy tissue, is FDA-cleared for the treatment of early stage breast cancer, endometrial cancer and skin cancer, and for the treatment of other cancers or conditions where radiation therapy is indicated. Xofta™s Axxent technology is approved for accelerated partial breast irradiation (APBI), which can be delivered twice daily for five days or it can be administered immediately following the lumpectomy procedure in only a few minutes with one course of therapy, also known as Intraoperative Radiation Therapy (IORT).
"By combining our innovative solutions, iCAD and Xoft can empower clinicians to improve patient outcomes through collaborative delivery of more targeted cancer detection, diagnosis, treatment and monitoring."
aOur new combined company is well positioned for long-term growth and to accelerate the adoption of new standards of care in oncology,a said Ken Ferry, President and CEO of iCAD. aBy combining our innovative solutions, iCAD and Xoft can empower clinicians to improve patient outcomes through collaborative delivery of more targeted cancer detection, diagnosis, treatment and monitoring.a
In the third quarter of 2010, the American Society for Radiation Oncology (ASTRO) applied for a Category 1 CPT procedure code for single fraction (one dose) Intraoperative Radiation Therapy (IORT). Numerous clinical studies, including the landmark TARGIT-A trial published in The Lancet in June 2010, havesupported this treatment option. A reimbursement decision is expected in the mid to late 2011 timeframe and changes to the current reimbursement would further expand the market for radiation therapy administered immediately following a lumpectomy procedure. Xofta™s technology may help more women who are candidates for breast conservation therapy (BCT) adhere to radiation therapy guidelines. Compliance rates vary widely between different populations based on proximity to care, length of treatment, and other factors.
aXofta™s technology expands patient access to potentially life-saving treatments globally and provides a compelling treatment alternative to traditional external beam radiation, which is administered five days per week over a six to seven week timeframe,a said Michael Klein, former President and CEO of Xoft. aWe are excited to join with iCAD on our mission to increase access to targeted radiation therapy, improve patient outcomes and better the experience for patients during their cancer treatments.a
Acquisition Terms
iCAD acquired 100% of the outstanding stock of Xoft in exchange for approximately 8.65 million shares of iCAD common stock and approximately $0.8 million in cash to certain Xoft stockholders, for a total consideration at closing of approximately $12.9 million, based on the average of the closing sale price of the Companya™s common stock over the thirty trading days immediately preceding the closing date. iCAD also paid certain transaction expenses of Xofta™s totaling approximately $1.0 million. Xoft stockholders now own approximately 15.8% of iCADa™s outstanding common stock. There is an additional earn-out potential for Xoft shareholders that is tied to cumulative net revenue of Xoft products over the next three years, payable at the end of that period, in cash or a combination of cash and iCAD common stock, subject to certain conditions.
The threshold for earn-out consideration begins at $50 million of cumulative revenue of Xoft products over the three year period immediately following the closing. The atargeteda earn-out consideration of $20 million will occur at $76 million of cumulative revenue of Xoft products and the maximum earn-out consideration of $40 million would be achieved at $104 million of cumulative Xoft product revenue over the three year period. The acquisition agreement contains customary representations, warranties, covenants, indemnifications and closing conditions.
Pursuant to the terms of the Merger Agreement executed in connection with the transaction on December 15, 2010, the representative of the Xoft stockholders has the right to nominate one designee for a three year period to iCADa™s board of directors, who is acceptable to iCADa™s nominating and corporate governance committee and its board of directors, subject to any required stockholder approval. Michael Klein is the initial designee. In addition, Somu Subramanian a stockholder and board member of Xoft, will also serve as a member of iCADa™s board of directors from the closing date until the next annual meeting of iCADa™s stockholders. Mr. Klein and Mr. Subramanian were approved by iCADa™s nominating and corporate governance committee and determined by the board to be independent under iCADa™s corporate governance principles and NASDAQ Listing Rule 5605(a)(2). The Board has also increased its size from six to eight members.
About Xoft, Inc.
Based in Sunnyvale, Calif., Xoft is a privately held company that develops Electronic Brachytherapy (eBx) systems based upon miniaturized X-ray tube technology for the practice of radiation oncology in a broad range of clinical settings, eliminating the need for heavily shielded environments. The Axxent treatment platform provides a therapeutic dose of radiation directly to the region at risk with minimal radiation exposure to surrounding healthy tissue and without the logistics and costs associated with using radioactive isotopes. FDA-cleared for treatment of early stage breast cancer, skin cancer and endometrial cancer, the Axxent System is also cleared for use in the treatment of other cancers or conditions where radiation therapy is indicated including IORT. For more information please visit [ www.xoftinc.com ].
About iCAD, Inc.
iCAD, Inc. is an industry-leading provider of advanced image analysis and workflow solutions that enable healthcare professionals to better serve patients by identifying pathologies and pinpointing cancer earlier. iCAD offers a comprehensive range of high-performance, upgradeable Computer-Aided Detection (CAD) systems and workflow solutions for mammography (film-based, digital radiography and computed radiography), Magnetic Resonance Imaging (MRI) and Computed Tomography (CT). Since receiving FDA approval for the Companya™s first breast cancer detection product in 2002, more than 4,000 iCAD systems have been placed in healthcare practices worldwide. iCADa™s solutions aid in the early detection of the most prevalent cancers including breast, prostate, colon, and in the future, lung cancer. For more information please call (877) iCADnow or visit [ www.icadmed.com ].
"Safe Harbor" Statement under the Private Securities Litigation Reform Act of 1995:
Certain statements contained in this News Release constitute aforward-looking statementsa within the meaning of the Private Securities Litigation Reform Act of 1995. Such forward-looking statements involve a number of known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements of the Company to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements. Such factors include, but are not limited to, the risks relating to the Companya™s acquisition of Xoft including, the expected benefits of the acquisition may not be achieved in a timely manner, or at all; the Xoft business operations may not be successfully integrated with iCADa™s following the closing and iCAD may be unable to achieve the expected synergies, business and strategic objectives following the transaction, and other risks detailed in the Companya™s filings with the Securities and Exchange Commission. The words abelievea, ademonstratea, aintenda, aexpecta, aestimatea, aanticipatea, alikelya, and similar expressions identify forward-looking statements. Readers are cautioned not to place undue reliance on those forward-looking statements, which speak only as of the date the statement was made. The Company is under no obligation to provide any updates to any information contained in this release.
