FOR IMMEDIATE RELEASE
CML Enters Final Stage Negotiations to Acquire Controlling Interest in
Summit Research Network
MISSISSAUGA, Ontario, November 5, 1998 - Canadian Medical Laboratories Limited (TSE: CLC), a leading edge healthcare company, today announced its US subsidiary, Novoquest Research Inc., is in the process of finalizing an agreement to acquire a 55% interest in the Summit Research Network. Novoquest has completed its due diligence of Summit and its research facilities.
As a result, final stage discussions are underway to complete a formal agreement. Closing of the transaction is expected to occur within the next 60 days, subject to execution of the purchase and sale agreement and satisfaction of the conditions to be contained in the agreement.
Summit Research Network, a Site Management Organization (SMO) based in Portland, Oregon, provides central management for its research sites which include Pacific Northwest Clinical Research Center in Portland, Seattle Clinical Research Center, Denver Center for Medical Research and the Institute for Health Studies with two locations in Michigan. These four sites will generate revenue in excess of $17 million CDN creating net income of approximately $2.1 million CDN for the year ending December 31, 1998.
We expect this to be the first of many successful acquisitions as we strive to have a significant positive impact on the US Site Services marketplace, said John Mull, MD, President and CEO. By consolidating clinical research sites we can create operating efficiencies through centralized marketing and automation while maintaining the highest quality research.
The Summit sites perform clinical trials in Central Nervous System disorders as well as in general medical illnesses. Each of the four sites have well-established reputations for rapid patient enrollment and high quality data; combined under Summit they represent a powerful core to which we intend to selectively add other prominent research centers in the very near future. With all of these research centers we will continue to deliver the same high quality service that Summit’s customers are accustomed to receiving, said Dr. Mull. Summit Research Network is supported by custom designed computer technology that collects, analyzes and archives patient data according to a variety of demographic and medical information classifications. Information from this database is shared across sites enabling Summit to enhance operating efficiencies and patient recruitment techniques.
CML intends to purchase its 55% interest in the four Summit sites and Summit Research Network, LLC, a SMO, for approximately $13.6 Million CDN.
This acquisition follows the earlier announcement by CML that it was entering the US clinical investigator market with the creation of the Academic Network for Clinical Research (ANCR). CML will now be able to offer pharmaceutical companies and Contract Research Organizations (CROs) clinical research from both academic and commercial sites.
Canadian Medical Laboratories Limited, is a leading edge healthcare company providing laboratory testing services in Ontario and pharmaceutical research services throughout North America. CML’s common shares trade on The Toronto Stock Exchange under the symbol "CLC" with approximately 16.8 million shares outstanding.
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