Repligen Buys Bioprocessing Business Of Refine Tech; Updates FY14 Guidance

(RTTNews) - Repligen Corp. (RGEN) announced that it has acquired the business of Refine Technology , including Refine's Alternating Tangential Flow or ATF System, a market-leading device used to significantly increase product yield during the fermentation step of the biologic drug manufacturing process.

Repligen has entered into a definitive agreement effective June 2, 2014 to purchase Refine's business for a combination of $20.5 million in cash and 215,285 shares of Repligen common stock, for total upfront consideration of approximately $24.5 million. The agreement also includes contingent milestone payments of up to $8.75 million based on defined revenue targets through the year 2016, a capped royalty provision of up to $2.15 million for above-target sales during the same period. The Company expects ATF System sales to add approximately $3.5-4.0 million in revenue for the remainder of the year 2014.

As a result of Repligen's acquisition of the business of Refine, the company is revising its financial guidance for the year 2014. Total product revenue for 2014 is expected to be $56 million -$59 million compared to previous guidance of $52 million -$55 million. This revised estimate reflects 18%-24% annual revenue growth, an increase from previous guidance of 10%-15% growth.

Product gross margin for the full year 2014 is expected to be 51%-53% and total operating income for the full year is expected to be $10 million -$12 million, a decrease from previous guidance of $11 million - $13 million. This decrease is primarily the result of one-time transaction and inventory related expenses and increased expenses related to the expansion of the Company's commercial operations.

Net income for the full year 2014 is now expected to be $8 million - $10 million. Cash and investments at year end are expected to be $62 million -$66 million.

The company said in March that it expects annual Total net income to be in the range of $7 million - $9 million. The company expected to end the year 2014 with $84 million - $87 million in cash and investments.