Exact Sciences sells certain intellectual property assets to Genzyme

Under the transaction, Exact retained exclusive worldwide rights to its colorectal cancer screening and stool-based DNA testing intellectual property, and will receive a share of Genzyme’s sublicensing income derived from the purchased intellectual property outside the fields of prenatal and reproductive health.

The transaction provides for Exact to receive $24.5 million in cash in total. At closing, Exact received $16.65 million, with an additional $1.85 million to be received over the next 18 months, contingent upon the non-occurrence of certain events, in exchange for the sale and license of certain of Exact’s intellectual property assets, including those relating to reproductive and prenatal health. In addition, Genzyme purchased three million shares of Exact common stock at $2 per share for an aggregate purchase price of $6 million.

Exact will retain rights to the technology for stool-based detection of any disease and stool or blood-based screening assays for colorectal cancer in patient samples. Further, Exact will receive exclusive rights in these fields to improvements to the purchased intellectual property that may be developed by Genzyme. Exact will also receive rights in these fields to improvements resulting from any joint developments between Exact and Genzyme.

In addition, Exact and Genzyme have amended their March 1999 license to provide Exact with the additional rights necessary to distribute FDA approved kits for stool-based detection of disease and colorectal cancer screening based on the detection of APC and P53 mutations.

Finally, Genzyme has agreed to pay Exact a double digit percentage of any sublicensing income that it receives outside the field of reproductive and prenatal health which utilize the intellectual property.