Fort Myers-based NeoGenomics Inc. has acquired the worldwide rights to use Health Discovery Corp.'s technology to develop new tests for the detection of various cancers.
NeoGenomics focuses on genetic testing for cancer.
Health Discovery, based in Savannah, Ga., has dozens of issued and pending patents for its technology.
The license agreement will allow NeoGenomics to develop and sell any gene, gene-product or protein-based laboratory test based on HDC's technology in the field and provides for sublicensing rights and the assignment of the agreement.
With the agreement, the initial focus will be on developing lab tests for the detection of prostate, pancreatic and colon cancer.
NeoGenomics paid $1 million in cash and issued 1.36 million shares of common stock to HDC in upfront licensing fees. In addition, NeoGenomics will make other payments, in cash or stock, based on sublicensing revenue and revenue generated from products and services developed as a result of the agreement.
Payments will be in increments of $500,000 for every $2 million in revenue recognized by NeoGenomics, up to a total of $5 million. After $20 million in revenue has been generated, NeoGenomics will pay a royalty of 6.5 percent on product sales and will share profits from sublicensing arrangements.
NeoGenomics also announced the appointment of a new chief medical officer, Maher Albitar, who recently served as HDC's chief medical officer.