NeoGenomics enters into agreement with Abbott for cancer test

Fort Myers-based NeoGenomics Inc. (OTC Bulletin Board: NGNM), a leading provider of cancer genetics testing services announced that it has entered into a Strategic Supply Agreement with Abbott. The agreement provides for Abbott to supply materials for NeoGenomics to develop its own FISH (fluorescence in situ hybridization)-based test for the diagnosis of melanoma. In a separate transaction, Abbott has also acquired 9.6 percent of NeoGenomics common stock for $4.8 million.

Under terms of the Strategic Supply Agreement, NeoGenomics will evaluate and select from Abbott's proprietary single FISH probes to develop and commercialize a test for melanoma diagnosis in the United States. Once the probes have been identified by NeoGenomics, Abbott will supply it (some on an exclusive basis) over the course of a 10-year term. The agreement may be expanded, under certain circumstances, to include up to two additional tests for other cancers.

According to the American Cancer Society, approximately 68,000 new cases of invasive melanoma will be diagnosed this year in the United States. Melanoma typically starts as an abnormal mole on the skin and is easily cured if caught and removed early. Once it spreads to other parts of the body, however, it is particularly deadly. NeoGenomics intends to develop a FISH test to distinguish benign versus malignant melanoma. The goal for the new test is to provide the ability to more accurately diagnose malignant melanoma and provide more accurate prognostic information, thus assisting dermatologists in better managing patient care.

"We are delighted to have entered into this strategic agreement with Abbott. Melanoma is the most serious form of skin cancer, and its incidence continues to rise significantly. We are very pleased to have this opportunity to research, develop and offer a new genetic test to help clients better diagnose and treat patients who may suffer from melanoma," said Douglas VanOort, chairman and chief executive officer for NeoGenomics.

NeoGenomics estimates that this new melanoma test represents a $50-$100 million annual revenue opportunity in the next four to six years.