Warnex Inc has entered into an agreement in principle for the acquisition of Molecular World Inc, a laboratory located in Thunder Bay, Ontario, specialized in human DNA identification including forensic DNA testing. The purchase price will be paid by the issuance of 2,000,000 common shares of Warnex. Through the acquisition of this new subsidiary, Warnex would also assume approximately $350,000 of debt.
The transaction is subject to certain conditions, namely, the conclusion of all related agreements and the relevant regulatory authorizations, and is expected to close within the next weeks.
"The acquisition of Molecular World will expand Warnex's DNA identification services, particularly in the forensic testing field, and provide us with a unique expertise. Molecular World is the only private laboratory in Canada providing STR, Y-STR, miniSTR, and mitochondrial DNA testing services for forensic and parentage testing purposes," said Mark Busgang, president and CEO of Warnex. "Their facility in Thunder Bay is state-of-the-art and their procedures and personnel meet all standards for judicial review and quality standards such as ISO 17025."
Molecular World offers services in all four DNA technologies required for human identification: autosomal nuclear (STR), miniSTR, Y-STR and mitochondrial DNA. Mitochondrial DNA testing is crucial in cases where nuclear DNA testing is not possible such as shed hairs at crime scenes, identification of missing persons (skeletal remains with degraded DNA), and when there is insufficient nuclear DNA. Molecular World has the state-of-the-art contamination control facilities to perform mitochondrial DNA testing, which is very sensitive to contamination. Molecular World is also accredited by the Standards Council of Canada (SCC) as a DNA testing laboratory for forensics, parentage and other familial relationships.
Forensic DNA analysis is being increasingly used in court cases and has acquired considerable publicity from high profile court cases involving DNA testing. DNA testing offers the most accurate form of scientific evidence to prove or disprove identity. In addition to helping solve criminal cases, DNA identification testing has been instrumental in proving wrongful conviction of people in many cases, resulting in their release.
Molecular World has helped solve several high profile cold cases. In 2006, Molecular World presented mitochondrial DNA evidence during the trial of Ronald Woodcock, leading to his conviction for murders that took place in 1994. This was the first conviction in Canadian courts using this unique mitochondrial DNA technology. In 2007, Molecular World identified a suspect for the 1984 death of 13-year-old Candace Derksen, leading to his arrest.
Molecular World had annual revenue of $544,000 in its last fiscal year. It will operate as a subsidiary of Warnex and will remain in its current facilities in Thunder Bay.
Warnex is a life sciences company devoted to protecting public health by providing laboratory services to the pharmaceutical and healthcare sectors.