Sema4 to Acquire GeneDx for Approximately $623 Million

Sema4 to Acquire GeneDx for Approximately $623 Million
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Patient-centered healthcare company Sema4, which leverages machine learning to deliver clinical and genomic intelligence, announced today that it will acquire rare-disease clinical genomic testing company GeneDx from OPKO Health.

The stock, cash and milestone payment deal is valued at $623 million based on Sema4’s closing stock price on Monday.

Under the terms of the deal, GeneDx President and CEO Katherine Stueland, formerly the Chief Commercial Officer at Invitae will be appointed co-CEO of the company at the closing of the deal, to serve alongside current Sema4 CEO and Founder Eric Schadt.

Central to the deal was GeneDx’s rare disease diagnosis and clinical exome sequencing capabilities along with data from more than 300,000 exomes and 2.1 million annotated patient phenotypes. These data will be combined with Sema4’s existing 12 million de-identified patient records and will add depth to the company’s artificial intelligence (AI)-driven health intelligence platform Centrellis, and its genomic analysis platform Traversa.

“This acquisition gives us the opportunity to accelerate the use of genomics as standard of care by providing a deeper menu of precision medicine solutions to our health system partners to better meet their clinical needs,” said Schadt in a press release. “Adding GeneDx’s comprehensive dataset and capabilities to our offerings enables us to inform on an even broader range of diseases, further closing the gap between the practice of medicine and the availability of more clinically actionable guidance.”

The acquisition of GeneDx falls directly in line with the strategy Sema4 has taken to build a health data company that can play a significant supporting role in providing actionable clinical intelligence to physicians and other care teams. A spin-out of the Mount Sinai School of Medicine—now Icahn School of Medicine—Schadt saw the need to refine the in-house data approach he was taking at Mt. Sinai to inform clinical decision making.

According to Schadt in an interview with Inside Precision Medicine from January 2021, there was a gap between the data needed to inform a drug development program versus providing data that can inform clinical decisions.

“This was another level of hardness. When I took a step back I asked: “Why is that? Why don’t [doctors] just want to change their standard of care?” Schadt aksed. “It was because the models themselves, while good enough to drive drug discovery, and good enough to get cool publications, they were not good enough to meet the clinical threshold of going into practice. That was a much higher bar.”

To help reach this higher bar, Sema4 has pursued a number of clinical/academic partnerships—including ongoing collaborations with Mt. Sinai—to not only help drive precision medicine programs, but also continue to build its patient data.

GeneDx, too, has pursued collaborations to refine its testing and develop its diagnostic capabilities with leading healthcare companies and including Tempus (in oncology), Geisinger (in cerebral palsy), and Illumina and the Brotman Baty Institute (in rare diease), among others.

“We are excited to join forces with Sema4, a market leader in using genomic and clinical data to deliver precision medicine,” said Stueland in a statement announcing the deal. “The complementary fit between our teams, missions, and capabilities is strong. We are eager to put those strengths to work and to make it easier to use data-driven insights to improve healthcare for all. I’m looking forward to partnering with Eric to create an unrivaled family health and health intelligence company, supporting patients making healthcare decisions throughout their lives, from pregnancy and newborn health to adult rare disease, risk assessment, and cancer care.”