AccelPath, Inc. Acquires DigiPath Solutions, LLC

| September 24, 2012

Mergers and acquisitions in the digital pathology space continue.  Recent news of Accelpath's acquisition of DigiPath Solutions below.  

Following the sale of Aperio recently,  standalone digital pathology companies are fewer and far between.  BioImagene was acquired by Roche/Ventana for $100 million in September 2010. Dmetrix was downsized into a small R&D focused company in 2009-2011. This left  three smaller independent firms involved with hardware/scanning: DigiPath Solutions (Spring, TX), DigiPath, Inc (Henderson, NV)  and MikroScan Technologies (Vista, CA). Now there are 2.

Few commonalities among these transactions: Marriage of technology provider services with workflow solutions, recognition of needs for combined software and hardware with user frequency leveraging the technology to broker the professional transaction and ability for consumers to choose increasingly from single vendor solutions rather than mutiple to implement telepathology. This could be perceived as a positive or negative. Go "best of breed" or "one stop shop" to enact hardware, software, workflow, reporting, resolve problems, etc…?  

Acquisition expands AccelPath’s digital telepathology customer
base and services platform

  • Deal strengthens position as leading
    pure play digital telepathology services provider
  • Acquisition immediately accretive to
    earnings


Accelpath_arrowAccelPath, Inc. (OTC:BB — ACLP) (“AccelPath” or the “Company”), a
leading provider of digital 
telepathology services, announced today that it has
acquired privately held DigiPath Solutions, LLC (“DigiPath”), a leading
provider of digital telepathology and laboratory development and management
services in Texas.

Founded in 2010, DigiPath currently services six pathology
laboratories covering eight customers in Houston, Texas, with near-term plans
to expand further in Texas.  DigiPath had
audited fiscal year June 30, 2012 revenues of $1.1 million, which represented a
106% increase over the prior year and EBITDA of $561,000, a 50% increase from
the prior year.

Rishi Reddy, founder and Chief Executive Officer of
DigiPath will join the AccelPath medical advisory board and help to integrate
the DigiPath business into AccelPath while also leading AccelPath’s global
expansion and developing its 3D imaging technology. 


Digipath-logoMr. Reddy will also focus on integrating DigiPath’s
laboratory build and management capabilities into AccelPath. His experienced
sales and operations team will continue to manage existing customer pathology
laboratories while engaging new business contracts and developing and managing
new pathology laboratories in the DigiPath pipeline.  The DigiPath team will also assist with AccelPath’s
new business pipeline by offering similar laboratory development and management
capabilities to prospective clients.

AccelPath acquired DigiPath for an aggregate purchase price
of $2.4 million, which consists of cash, 1,250 shares of AccelPath convertible
preferred stock, and a promissory note issued to Mr. Reddy in the amount of
$1,050,000. In addition, the Company entered into a one-year consulting
agreement with Mr. Reddy.

“After
spending the past several months with the AccelPath management and operating team,
I have become very impressed with their wealth of knowledge in digital
telepathology and, specifically, their workflow software technology,” stated
Mr. Reddy. “The Company’s digital telepathology workflow software will
facilitate the expansion of DigiPath’s business and take it to the next level
of automation.  Further, we are pleased
to bring DigiPath’s laboratory development capabilities to the Company, which
will provide a broader product offering to the combined entity and facilitate growth.  I also look forward to assisting with the
development of the Company’s proprietary 3D imaging technology as it relates to
digital telemedicine.  This is a very
exciting time for the combined companies.”

“We
are very pleased to have Mr. Reddy join our team,” stated Shekhar Wadekar,
AccelPath’s Chief Executive Officer.  “We
are truly impressed by his performance of substantially growing DigiPath from a
start-up to a profitable entity within a very short time.  He brings a wealth of knowledge to the
Company from an operational and growth perspective.  Further, Mr. Reddy will play an integral role
in developing certain of our proprietary 3D imaging technologies as they relate
to digital telemedicine and we welcome Mr. Reddy and his team to AccelPath.  AccelPath will continue to seek out similar
synergistic acquisitions.”

About AccelPath 

AccelPath provides technology solutions that play a key role in delivering
information required for diagnosis of diseases and other pathologic conditions
with and through its associated institutional pathologists. The medical
institutions, with whom the Company partners, prepare comprehensive diagnostic
reports of a patient’s condition and consult with referring physicians to help
determine the most appropriate treatment. Such diagnostic reports enable the
early detection of disease, allowing referring physicians to make informed and
timely treatment decisions that improve their patients’ health in a
cost-effective manner. The Company seeks out referring physicians and histology
laboratories in need of high-quality pathology interpretations and manages
HIPAA-compliant digital case delivery and reporting while developing comprehensive
solutions for managing medical information. 

AccelPath is currently focused on the $14 billion anatomic
pathology market in the US. The Company’s business model builds upon the
expertise of experienced pathologists to provide seamless, reliable and
comprehensive pathology and special test offerings to referring physicians
using conventional and digital technologies. The Company establishes
longstanding relationships with the referring physicians as a result of focused
delivery of its partner’s diagnostic services, personalized responses and
frequent consultations, and its proprietary flexible information technology, or
IT, solutions that are customizable to the referring physicians’ or
laboratories as well as the pathologists’ needs. Such diagnostic reports often
enable the early detection of disease, allowing referring physicians to make
informed and timely treatment decisions that improve their patients’ health in
a cost-effective manner. AccelPath’s IT and communications platform enables it to
efficiently and securely deliver diagnostic reports to referring physicians. In
addition, AccelPath’s IT platform enables close tracking and monitoring of
medical statistics.

AccelPath is focused on the design, research, development
and integration of three-dimensional imaging devices and systems primarily in
the healthcare industries which it contributes to the Company.  The Company will also exploit its
three-dimensional imaging technology for use in intelligent surveillance
devices and systems, as well as three-dimensional facial recognition systems
for security and law enforcement agencies thru future strategic partnerships.
Historically, the Company’s largest customers have been the National Institutes
of Health
and the Department of Defense. 

Additional Company information may be found on the
Internet at: www.accelpath.com.

Forward-Looking Statements

This press release
contains certain “forward-looking statements” relating to the business of the
Company, which can be identified by the use of forward-looking terminology such
as “may,” “will,” “expect,” “anticipate,” “intend,” “estimate,” “believe,”
“project,” “continue,” “plan,” “forecast,” or other similar words, or the
negative thereof, unless the context requires otherwise. These statements
include, but are not limited to, statements about the Company’s expectations of
the combined companies and the anticipated benefits and revenues, the Company’s
expected future performance and the acceptance of the Company’s product
offerings.  The results anticipated by
any or all of these forward-looking statements may not occur. In addition,
these statements reflect management’s current views with respect to future
events and are subject to numerous risks, uncertainties and other factors that
could cause actual results to differ materially from those set forth in or
implied by these forward-looking statements. Factors that could affect those
results include, but are not limited to, our ability to integrate both
companies, the acceptance of our solutions in the marketplace, the efforts of
our sales force, general economic conditions, and those described in the
Company’s reports on Forms 8-K, 10-Q and 10-K and proxy statements and
information statements including amendments, which have been or will be filed
by the Company with the Securities and Exchange Commission (the “SEC”),
including without limitation under the caption “Risk Factors” in the Company's
Annual Report on Form 10-K filed on October 13, 2011. Many of the factors that
will determine the outcome of the subject matter of this press release are
beyond the Company’s ability to control or predict. The Company undertakes no
obligation and expressly disclaim any obligation, to revise or publicly update
any forward-looking statements, or to make any other forward-looking
statements, whether as a result of new information, future events or otherwise.

Contact:

Investor Relations:

AccelPath, Inc.

Robert Weinstein,
Business Development

914.295.2765

ir@accelpath.com

or

Shekhar Wadekar, Chief
Executive Officer

781.269.2120

Source: Accelpath

 


Category: Digital Pathology News, Histology, Pathology News

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