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MEMORANDUM

PRIVILEGED AND CONFIDENTIAL ATTORNEY WORK PRODUCT

TO: James Prentice, Partner; Sandra Tung, Partner; Tiffany Rosenthal, Senior Associate

FROM: Andrew Fitzpatrick, Associate

DATE: May 15, 2023

RE: Hart-Scott-Rodino Antitrust Improvements Act — Filing Analysis for the OncuPath™ Asset Divestiture

Matter No.: 1013-00006&A-4471

Client: Genome Dx Therapeutics Inc.

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I. Executive Summary

The purpose of this memorandum is to analyze the applicability of the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended (the "HSR Act"), 15 U.S.C. § 18a, to the proposed acquisition by Meridian Precision Diagnostics, Inc. ("Buyer" or "Meridian") of certain assets constituting the OncuPath™ companion diagnostics assay line (the "OncuPath Business") from our client, Genome Dx Therapeutics Inc. ("Seller" or "GDT"), pursuant to that certain Asset Purchase Agreement dated May 11, 2023 (the "APA"). This analysis addresses the threshold filing requirements, the identification of the relevant persons and ultimate parent entities, the applicability of any statutory or regulatory exemptions, and the procedural steps and timeline for compliance with the premerger notification obligations under the HSR Act and its implementing regulations, 16 C.F.R. Parts 801–803.

Conclusion. Based on the analysis set forth below, the proposed transaction is reportable under the HSR Act, and both parties are required to file premerger notification with the Federal Trade Commission ("FTC") and the Antitrust Division of the United States Department of Justice ("DOJ") prior to consummation of the acquisition. The transaction satisfies both the size-of-transaction test and the size-of-person test under the 2023 filing thresholds. No statutory or regulatory exemption relieves the parties of the obligation to file.

The total consideration for the OncuPath Business is $140,000,000, comprising $126,000,000 in cash payable at closing and up to $14,000,000 in contingent earnout payments tied to the achievement of two specified clinical milestones. Even excluding the contingent earnout payments and considering only the closing cash consideration, the size-of-transaction threshold of $111.4 million (as adjusted for 2023) is exceeded. Both parties independently satisfy the applicable size-of-person thresholds by substantial margins.

Recommendation. We recommend that HSR Notification and Report Forms be filed promptly on behalf of both the acquiring person and the acquired person, with both filings requesting early termination of the statutory thirty-day waiting period. Given the complementary nature of the parties' respective product portfolios and the fragmented competitive landscape in the companion diagnostics market, we assess the risk of a Second Request as low and believe early termination is likely to be granted. We recommend a target filing date of May 18, 2023, which is within ten business days of the execution of the APA and well in advance of the target closing date of August 1, 2023.

Note — Post-Filing Update: This memorandum has been supplemented with a post-filing update in Section XI reflecting events subsequent to the original date of this analysis. Both parties filed their respective HSR Notification and Report Forms on May 18, 2023. The FTC granted early termination of the waiting period effective June 22, 2023. No Second Request was issued. The transaction closed on August 8, 2023.

II. Transaction Overview

A. The Seller

Genome Dx Therapeutics Inc. ("GDT") is a Delaware corporation headquartered at 4150 Campus Point Court, Suite 400, San Diego, California 92121. GDT develops and commercializes genomic profiling assays for oncology and rare-disease applications. The company's product portfolio includes multi-gene expression assays, next-generation sequencing panels, and companion diagnostics used in the selection of targeted therapies across multiple solid tumor types. For the fiscal year ended December 31, 2022, GDT reported total revenue of approximately $312,000,000.

GDT's majority equity sponsor is Pinnacle Biosciences Partners Fund III, L.P. ("Pinnacle" or "PBP III"), a Delaware limited partnership that holds approximately 68.4% of GDT's outstanding common stock. PBP III is a growth equity fund focused on investments in the life sciences, diagnostics, and digital health sectors. The general partner of PBP III is Pinnacle Biosciences Partners GP III, LLC ("PBP GP III"), a Delaware limited liability company. The managing partners of PBP GP III are Nathaniel Hargrove and Priya Ramanathan. Pinnacle manages approximately $4.2 billion in assets under management across four funds and maintains its principal office at 600 Lexington Avenue, Suite 3100, New York, New York 10022.

B. The Buyer

Meridian Precision Diagnostics, Inc. ("Meridian" or "MPD") is a Delaware corporation headquartered at 2400 Meridian Parkway, Suite 300, Durham, North Carolina 27713 (Research Triangle Park). Meridian develops and commercializes precision diagnostics platforms, including CLIA-validated laboratory-developed tests, immunohistochemistry-based companion diagnostics, and liquid biopsy assays used in oncology, cardiology, and autoimmune disease. For the fiscal year ended December 31, 2022, Meridian reported revenue of approximately $589,000,000 and earnings before interest, taxes, depreciation, and amortization ("EBITDA") of approximately $104,000,000.

Based on information available to us as of the date of this memorandum, Meridian does not appear to be controlled by a parent entity or controlling stockholder; it is treated as a standalone corporation and as its own ultimate parent entity for purposes of the HSR Act analysis.

C. The Transaction

Pursuant to the APA, Meridian will acquire all assets, intellectual property, contracts, inventory, equipment, regulatory filings, and goodwill exclusively related to GDT's OncuPath™ companion diagnostics assay line (collectively, the "OncuPath Business"). The OncuPath Business encompasses a suite of tissue-based and blood-based companion diagnostic assays designed to identify patients likely to respond to specific targeted oncology therapies. For FY 2022, the OncuPath Business generated revenue of approximately $47,600,000.

The total purchase price is $140,000,000, structured as follows:

(i) Closing Cash Payment. $126,000,000, payable by Meridian at closing by wire transfer of immediately available funds to an account designated by GDT.

(ii) Earnout Payments. Up to $14,000,000 in contingent milestone-based payments, consisting of:

• Milestone 1 Payment: $8,000,000, payable upon FDA clearance or approval of the OncuPath-HER3™ assay on or before August 8, 2025; and

• Milestone 2 Payment: $6,000,000, payable upon assignment of a CMS HCPCS code and first Medicare reimbursement for OncuPath-HER3™ on or before August 8, 2026.

The APA was executed on May 11, 2023, with a target closing date of August 1, 2023.

D. Transaction Advisors and Financing

Meridian's outside legal counsel is Whitfield Sayer & Gregg LLP, Charlotte, North Carolina, with Jonathan Whitfield serving as lead partner and Rachel Dempsey as senior associate. GDT's financial advisor for the sale process is Brindoval Partners LLC, Los Angeles, California, with Victor Sandoval, Managing Director, leading the engagement. GDT is represented by our firm, Calderwood & Harkness LLP.

Meridian's acquisition financing is being provided by Summit National Bank, N.A., pursuant to a committed term loan facility in the amount of $95,000,000 (the "Acquisition Facility"). The balance of the closing consideration is expected to be funded from Meridian's existing cash on hand and revolving credit facility.

III. HSR Act Statutory Framework

A. Overview of the HSR Act and Premerger Notification Requirements

Section 7A of the Clayton Act, 15 U.S.C. § 18a, as amended by the Hart-Scott-Rodino Antitrust Improvements Act of 1976, Pub. L. No. 94-435, Title II, 90 Stat. 1390 (1976), requires that parties to certain acquisitions of voting securities, assets, or interests in unincorporated entities file premerger notification with the FTC and the Antitrust Division of the DOJ and observe a statutory waiting period before consummating the proposed transaction. The HSR Act was enacted to provide the federal antitrust enforcement agencies with advance notice of significant mergers and acquisitions so that they may investigate and, where appropriate, challenge potentially anticompetitive transactions before consummation rather than attempting to unscramble completed transactions after the fact.

The HSR Act and its implementing regulations, promulgated by the FTC at 16 C.F.R. Parts 801 through 803, establish a system of threshold tests to determine whether a particular transaction triggers the filing obligation. The regulatory framework prescribes the content and format of the HSR Notification and Report Form (the "HSR Form") that must be filed by each party, the calculation of the applicable waiting period, the procedures for early termination and extension of the waiting period, and the consequences of noncompliance.

Both the acquiring person and the acquired person are required to file separate HSR Forms. In the context of the present transaction, the acquiring person is Meridian (acting through its ultimate parent entity, which, as discussed in Section V below, is Meridian itself), and the acquired person is GDT (acting through its ultimate parent entity, which, as discussed in Section V below, is Pinnacle Biosciences Partners GP III, LLC). Failure to file when required, or failure to observe the waiting period, may result in civil penalties of up to $50,120 per day (as adjusted for inflation) for each day of noncompliance, as well as potential injunctive relief. See 15 U.S.C. § 18a(g)(1).

B. Applicability Tests — Two-Part Threshold Analysis

The HSR Act establishes two independent tests that must be satisfied for the premerger notification requirement to apply: (1) the size-of-transaction test and (2) the size-of-person test. Both tests incorporate dollar thresholds that are adjusted annually by the FTC to account for changes in the gross national product. The 2023 thresholds, which became effective on February 27, 2023, are the thresholds applicable to this analysis.

As a general matter, the size-of-transaction test is satisfied if, as a result of the proposed acquisition, the acquiring person would hold voting securities, assets, or non-corporate interests valued in excess of the applicable threshold. If the transaction value exceeds the higher size-of-transaction threshold (which, for 2023, is $445.5 million), the transaction is reportable regardless of the sizes of the parties, and the size-of-person test does not apply. If the transaction value exceeds the lower threshold ($111.4 million for 2023) but does not exceed the higher threshold, the size-of-person test must also be satisfied: one party must have total assets or annual net sales of at least $222.7 million, and the other party must have total assets or annual net sales of at least $22.3 million (using 2023 thresholds).

C. The Waiting Period

Upon the filing of complete HSR Forms by both parties, a statutory waiting period commences. The standard waiting period is thirty (30) calendar days, running from the day after the date on which both parties' filings have been received by both the FTC and the DOJ. A shorter fifteen-day waiting period applies to cash tender offers and certain acquisitions from bankruptcy proceedings; neither shortened period is applicable to the present transaction, which is structured as an asset purchase agreement.

During the waiting period, the parties are prohibited from consummating the transaction. The FTC and DOJ use the waiting period to conduct an initial review of the transaction and determine whether further investigation is warranted. If neither agency takes action during the initial waiting period, the waiting period expires and the parties are free to close.

Either agency may, during the initial waiting period, issue a request for additional information and documentary material (commonly referred to as a "Second Request"), which has the effect of extending the waiting period until thirty (30) days after both parties have certified substantial compliance with the Second Request. Second Requests are resource-intensive and can add several months to the preclosing timeline.

Alternatively, either or both parties may request early termination of the waiting period on their HSR Forms. If the reviewing agency determines that no further investigation is warranted, it may grant early termination, which is publicly announced on the FTC's website.

IV. Size-of-Transaction Test

A. 2023 Filing Thresholds

As revised for 2023 pursuant to the FTC's annual adjustment published in the Federal Register at 88 Fed. Reg. 5,572 (January 27, 2023), the HSR Act filing thresholds are as follows:

A transaction is potentially reportable if it is valued at more than $111.4 million (subject to the size-of-person test). A transaction valued at more than $445.5 million is reportable regardless of the sizes of the persons involved.

B. Determination of Transaction Value for Asset Acquisitions

For acquisitions of assets, the "size of the transaction" is determined under 16 C.F.R. § 801.10, which provides that the value of the assets to be acquired is the aggregate total amount of voting securities and assets to be held as a result of the acquisition. In the case of an asset purchase, the acquisition price is generally the greater of the fair market value of the assets being acquired or the contractually agreed-upon purchase price. See 16 C.F.R. § 801.10(b).

In this transaction, the total contractual consideration is $140,000,000, comprising the $126,000,000 closing cash payment and the maximum $14,000,000 in contingent earnout payments.

Treatment of Earnout Payments. A threshold question in calculating the transaction value is whether the contingent earnout payments should be included. Under FTC guidance and informal interpretations, contingent consideration is generally included in the determination of the acquisition price at the maximum amount payable when the contingent payments represent binding contractual obligations that will become due upon the occurrence of specified events. Here, the earnout payments under the APA are contractually committed: Meridian is obligated to pay up to $8,000,000 upon FDA clearance or approval of OncuPath-HER3™ and up to $6,000,000 upon CMS HCPCS code assignment and first Medicare reimbursement. Although the payments are contingent upon the achievement of specified clinical milestones, the obligation to pay is a binding contractual commitment, and the FTC's Premerger Notification Office has consistently taken the position that such amounts should be included in the transaction value at the maximum amount potentially payable.

Accordingly, the size of the transaction for HSR purposes is calculated as follows:

Closing Cash Payment: $126,000,000 Maximum Earnout: $14,000,000 Total Transaction Value: $140,000,000

We note that even if the earnout payments were excluded entirely from the calculation — which we do not believe to be the correct treatment under the applicable guidance — the closing cash payment alone ($126,000,000) independently exceeds the $111.4 million threshold. The inclusion or exclusion of the earnout is therefore not outcome-determinative for the size-of-transaction analysis.

The total transaction value of $140,000,000 exceeds the $111.4 million minimum threshold but does not exceed the $445.5 million higher threshold. Consequently, the transaction is not reportable solely on the basis of the size-of-transaction test; the size-of-person test must also be satisfied.

C. Conclusion on Size-of-Transaction

The size-of-transaction test is satisfied. The total consideration of $140,000,000 exceeds the 2023 filing threshold of $111.4 million. Because the transaction value does not exceed $445.5 million, the analysis must proceed to the size-of-person test, which is addressed in Section V below.

V. Size-of-Person Test

A. Applicable Threshold

Because the transaction is valued between $111.4 million and $445.5 million, the size-of-person test must also be met for the filing obligation to be triggered. Under the 2023 thresholds, the size-of-person test requires that one person involved in the transaction have total assets or annual net sales of at least $222.7 million and that the other person have total assets or annual net sales of at least $22.3 million. The "person" for HSR purposes includes the ultimate parent entity ("UPE") and all entities controlled by the UPE.

B. Identification of the "Persons" and Ultimate Parent Entities

1. The Acquired Person

GDT is the entity whose assets are being sold in the proposed transaction. However, under 16 C.F.R. § 801.1(a)(1), the "person" for HSR purposes is defined broadly to include the ultimate parent entity and all entities that the ultimate parent entity controls. "Control" is defined in 16 C.F.R. § 801.1(b) as, among other things, holding 50% or more of the outstanding voting securities of an issuer or having the contractual power to designate 50% or more of the directors of a corporation.

Pinnacle Biosciences Partners Fund III, L.P. holds approximately 68.4% of GDT's outstanding common stock and therefore controls GDT within the meaning of the HSR regulations. As a limited partnership, PBP III is in turn controlled by its general partner, Pinnacle Biosciences Partners GP III, LLC. The UPE analysis under the HSR rules requires looking through the ownership chain to identify the entity at the top of the chain that is not itself controlled by any other entity.

PBP GP III, LLC is managed by its two managing partners, Nathaniel Hargrove and Priya Ramanathan. Under the HSR regulations, a natural person is not treated as an "entity" for purposes of the control analysis unless the natural person holds 50% or more of the outstanding voting securities or interests of an entity. Based on available information, neither Mr. Hargrove nor Ms. Ramanathan individually holds a 50% or greater interest in PBP GP III, LLC. Accordingly, PBP GP III, LLC is not controlled by any single natural person or entity and is therefore the ultimate parent entity of GDT for HSR purposes.

We recommend confirming the ownership and governance structure of PBP GP III, LLC with Pinnacle's counsel prior to filing. If either managing partner holds a 50% or greater interest, that individual would be the UPE, and the filing would need to be made in his or her name. For purposes of this analysis, we treat PBP GP III, LLC as the UPE.

The "acquired person" for HSR purposes therefore includes PBP GP III, LLC, PBP III, GDT, and all other entities controlled directly or indirectly by PBP GP III, LLC. The size-of-person analysis for the acquired person will aggregate the total assets and annual net sales of all such entities.

2. The Acquiring Person

Meridian Precision Diagnostics, Inc. is the entity acquiring the OncuPath Business. Based on the information available to us, Meridian is a standalone corporation that is not controlled by any parent entity, controlling stockholder, or other entity holding 50% or more of its outstanding voting securities. Accordingly, Meridian is treated as its own UPE, and the "acquiring person" for HSR purposes consists of Meridian and all entities it controls.

We have not identified any subsidiaries or controlled entities of Meridian that would materially affect the size-of-person analysis. Should additional information regarding Meridian's corporate structure emerge in the course of preparing the filing, this analysis should be revisited.

C. Application of Size Thresholds

The size-of-person test requires that one party meet the $222.7 million threshold and the other party meet the $22.3 million threshold. The analysis is satisfied regardless of which party is measured against which prong, but for completeness we assess both:

Meridian (Acquiring Person):

• FY 2022 total revenue: approximately $589,000,000

• FY 2022 EBITDA: approximately $104,000,000

• Total assets: not independently confirmed, but given a revenue base of $589 million and the capital-intensive nature of Meridian's diagnostics platforms business, total assets are reasonably presumed to exceed $222.7 million by a wide margin

• Conclusion: Meridian satisfies the "at least $222.7 million" prong of the size-of-person test

Pinnacle/GDT (Acquired Person):

• GDT FY 2022 total revenue: approximately $312,000,000

• Pinnacle aggregate assets under management (across four funds): approximately $4.2 billion

• Either GDT's revenue alone ($312 million) or Pinnacle's aggregate assets independently exceeds the $222.7 million threshold, and both far exceed the $22.3 million threshold

• Conclusion: The acquired person satisfies the "at least $22.3 million" prong of the size-of-person test — and, indeed, independently satisfies the $222.7 million prong as well

Both prongs of the size-of-person test are satisfied regardless of which party is assigned to which threshold. Each party independently exceeds both the $222.7 million and $22.3 million thresholds.

D. Conclusion on Size-of-Person

The size-of-person test is met. Both the acquiring person and the acquired person far exceed the applicable 2023 thresholds. When combined with the satisfaction of the size-of-transaction test as set forth in Section IV, the proposed transaction triggers the premerger notification obligation under the HSR Act.

VI. Exemptions Analysis

A. Potentially Applicable Exemptions

The HSR Act and its implementing regulations provide a number of exemptions from the filing requirement for certain categories of transactions. See 15 U.S.C. § 18a(c); 16 C.F.R. Part 802. We have reviewed each potentially applicable exemption to determine whether any would relieve the parties of the obligation to file in connection with this transaction.

Section 802.1 — Acquisition of Realty. This exemption applies to the acquisition of certain categories of real property, including new facilities for the production of goods or services and unproductive real property. The assets being acquired in the OncuPath Business are primarily intellectual property, contracts, equipment, regulatory filings, inventory, and goodwill. Although certain real property interests (e.g., leasehold interests in laboratory space) may be among the transferred assets, the transaction is not primarily or solely an acquisition of realty within the meaning of this exemption. This exemption does not apply.

Section 802.2 — Acquisitions of Goods and Realty in the Ordinary Course of Business. This exemption applies to acquisitions of goods transferred in the ordinary course of business. The acquisition of an entire business line — including intellectual property, regulatory filings, contracts, and goodwill — is plainly not an acquisition of goods in the ordinary course. This exemption does not apply.

Section 802.4 — Transfers to or from Federal, State, or Local Agencies. Neither party is a governmental agency. This exemption does not apply.

Section 802.5 — Acquisitions by Certain Regulated Entities. While the companion diagnostics industry is subject to FDA regulation and CMS reimbursement policies, neither party is an entity of the type regulated under the exemption provisions (e.g., banks, savings institutions, or common carriers). No exemption for assets used in regulated industries would apply to companion diagnostics. This exemption does not apply.

Section 802.6 — Foreign Assets and Section 802.50–802.52 — Foreign Transactions. The OncuPath Business is conducted within the United States, and both parties are domestic corporations. The foreign transaction exemptions are inapplicable.

Section 802.30 — Intraperson Transactions. The transaction is between unaffiliated parties and does not involve a transfer within a single corporate family. This exemption does not apply.

Section 802.63 — Certain Acquisitions of Carbon-Based Mineral Reserves. Not applicable.

We have also considered whether any other exemption under 15 U.S.C. § 18a(c) might apply, including exemptions for acquisitions solely for investment purposes (not applicable, as Meridian is acquiring the OncuPath Business for operational purposes) and exemptions for acquisitions of non-voting securities (not applicable, as the transaction is an asset purchase, not an acquisition of non-voting securities). None of the statutory or regulatory exemptions apply to the proposed transaction.

B. Conclusion on Exemptions

No applicable HSR Act exemption exists that would relieve either party of the obligation to file. The transaction is reportable, and premerger notification is required.

VII. Filing Requirements and Procedures

A. Filing Parties

Both the acquiring person (Meridian, through its UPE) and the acquired person (Pinnacle/GDT, through the UPE of GDT, i.e., PBP GP III, LLC) are required to file HSR Notification and Report Forms. Each party files its own form, and both filings must be submitted to both the FTC and the DOJ.

Our firm, Calderwood & Harkness LLP, will coordinate the preparation and filing of the HSR Form on behalf of our client, GDT, and its UPE, Pinnacle Biosciences Partners GP III, LLC. Buyer's counsel, Whitfield Sayer & Gregg LLP (Jonathan Whitfield, lead partner, and Rachel Dempsey, senior associate), will coordinate the preparation and filing of Meridian's HSR Form.

To ensure that the thirty-day waiting period commences promptly and simultaneously, both filings should be submitted on the same date. We recommend coordinating with Buyer's counsel to align on a mutual filing date of May 18, 2023.

B. Filing Fee

The HSR Act requires payment of a filing fee, the amount of which is determined by the value of the transaction. For 2023, the fee schedule (as adjusted pursuant to the Consolidated Appropriations Act, 2023) is as follows:

The total transaction value of $140,000,000 falls within the first tier, and the applicable filing fee is $125,000. Under standard practice, the filing fee is paid by the acquiring person. Section 8.3(b) of the APA provides that the Buyer shall be responsible for the HSR Act filing fee. We should confirm this allocation with the deal team and with Buyer's counsel prior to filing to avoid any delays.

C. Information Required in the Filing

The HSR Notification and Report Form requires extensive information from each filing party, including, but not limited to, the following:

Item 1 — Identification. Name, address, and organizational information of the filing person, the UPE, and all entities within the person.

Item 2 — Acquisition. Description of the transaction, including the parties, the structure, the consideration, the anticipated date of consummation, and the identity of all entities whose assets or voting securities are being acquired.

Item 3 — Financial Information. Revenue data, balance sheet information, and NAICS code classifications for the filing person and the acquired entity. Relevant NAICS codes for the OncuPath Business and Meridian's diagnostics operations include 325413 (In-Vitro Diagnostic Substance Manufacturing) and 621511 (Medical Laboratories).

Item 4 — Documents. Item 4 is among the most significant components of the filing. It requires the production of all documents — including studies, surveys, analyses, and reports — that were prepared by or for any officer or director (or, in the case of the acquiring person, prepared by or for the supervisory deal team lead) for the purpose of evaluating or analyzing the acquisition with respect to market shares, competition, competitors, markets, potential for sales growth, or expansion into product or geographic markets. This includes:

• Board of directors presentations and materials from the May 8, 2023 GDT board meeting at which the transaction was approved;

• Investment banker analyses, competitive landscape assessments, and valuation presentations prepared by Brindoval Partners LLC (Victor Sandoval, Managing Director; Elaine Cho, Vice President) in connection with the sale process;

• Internal management presentations, strategic planning documents, and competitive analyses prepared by GDT management relating to the OncuPath Business;

• Comparable documents prepared by or for Meridian's officers, directors, or deal team, which Buyer's counsel will be responsible for collecting and producing.

Item 5 — Prior Acquisitions. Information regarding acquisitions of entities operating in the relevant product and geographic markets completed by the filing person within the preceding five years.

Item 6 — Contracts. Copies of certain agreements between the parties, including the APA and any related agreements.

Item 7 — Subsidiaries and Affiliates. Organizational charts and entity information.

Description of Acquired Assets. The filing will include a detailed description of the assets comprising the OncuPath Business, including:

• All intellectual property, consisting of fourteen (14) issued U.S. utility patents, seven (7) pending patent applications, and three (3) registered trademarks (including the ONCUPATH™ word mark and design mark);

• All contracts assigned or to be assigned to Meridian;

• All equipment, instruments, and laboratory assets;

• All inventory of assay kits, reagents, and consumables;

• All regulatory filings and approvals, including FDA 510(k) clearances (K201847, K193215, and K210562) and PMA supplement P230014;

• FDA establishment registrations and device listings; and

• Goodwill associated with the OncuPath Business.

D. NAICS Code and Product Market Considerations

The HSR Form requires that each party identify the NAICS codes corresponding to the products and services involved in the transaction. The primary NAICS codes applicable to the OncuPath Business and Meridian's diagnostics operations are:

• 325413 — In-Vitro Diagnostic Substance Manufacturing

• 621511 — Medical Laboratories

Both GDT and Meridian operate broadly within the precision diagnostics and companion diagnostics space. However, based on our preliminary assessment of the parties' respective product portfolios, the degree of direct competitive overlap is limited. Meridian's existing CLIA-validated test menu is focused primarily on oncology panels utilizing immunohistochemistry and liquid biopsy platforms, while the OncuPath assay line employs multi-gene expression profiling and next-generation sequencing technologies. The acquisition is strategic and complementary in nature — it is designed to expand Meridian's test menu and geographic reach rather than to consolidate directly competing products.

The companion diagnostics market is highly fragmented, with numerous participants ranging from large integrated diagnostics companies (e.g., Roche/Granite Harbor & Co., Westmark Corporation Scientific, Granite Harbor Corporation/Dako) to smaller specialized assay developers. No single participant holds a dominant market share, and barriers to switching among companion diagnostics products are moderated by the role of pharmaceutical partner selection, clinical validation requirements, and payer coverage decisions. Based on these considerations, we assess the substantive antitrust risk associated with this transaction as low.

VIII. Timing Considerations and Early Termination Strategy

A. Waiting Period Mechanics

The statutory thirty-day waiting period commences on the day after the date on which both parties' complete HSR filings have been received by both the FTC and the DOJ. The waiting period is measured in calendar days, not business days. If the thirtieth day falls on a Saturday, Sunday, or federal holiday, the waiting period is extended to the next business day.

Assuming both parties file on May 18, 2023, and the filings are accepted as complete on that date, the thirty-day waiting period would commence on May 19, 2023. The standard expiration date would be June 17, 2023. However, June 17, 2023 falls on a Saturday. The following day, June 18, 2023, is a Sunday. June 19, 2023 is the Juneteenth National Independence Day federal holiday. Accordingly, the waiting period would not expire until the next business day, which is Tuesday, June 20, 2023.

B. Early Termination

Both parties may request early termination of the waiting period by checking the appropriate box on their respective HSR Forms. The FTC and DOJ grant early termination at their discretion. In practice, early termination is routinely granted for transactions that do not present competitive concerns or that fall outside the reviewing agency's current enforcement priorities. Requests for early termination are processed on a rolling basis, and the typical turnaround time ranges from approximately fifteen to twenty-five days from the date of filing, depending on the agencies' workload and the complexity of the transaction.

Given the low antitrust risk profile of this transaction — including the complementary nature of the parties' product portfolios, the fragmented market structure, and the absence of any prior antitrust enforcement actions involving either party in the diagnostics space — we recommend that both filings include a request for early termination. We expect that early termination is likely to be granted.

Upon grant of early termination, the FTC publishes a notice on its website identifying the parties and the grant date. Once early termination is granted (or the waiting period expires), the parties may proceed to consummate the transaction subject to satisfaction of all other closing conditions under the APA.

C. Second Request Risk Assessment

A Second Request for additional information and documentary material under 15 U.S.C. § 18a(e)(1)(A) is issued when the reviewing agency (FTC or DOJ) determines that additional investigation is warranted to assess the competitive implications of a proposed transaction. Second Requests are resource-intensive, typically requiring the production of large volumes of documents and data, and can extend the preclosing timeline by several months.

Based on the following factors, we assess the risk of a Second Request in connection with this transaction as low:

1. Complementary Product Portfolios. Meridian's existing diagnostics product menu and the OncuPath assay line employ distinct technology platforms and serve largely non-overlapping clinical indications. The acquisition expands Meridian's product offerings rather than consolidating competing products.

2. Fragmented Market Structure. The companion diagnostics market features numerous competitors, including both large integrated diagnostics companies and smaller specialized players. No single market participant holds a dominant share.

3. No Prior Antitrust Issues. We are not aware of any prior antitrust investigations, consent orders, or enforcement actions involving GDT, Pinnacle, or Meridian in the diagnostics space.

4. Transaction Size. While the $140 million transaction value is above the filing threshold, it is relatively modest compared to the large-scale diagnostics transactions that have historically attracted antitrust scrutiny.

5. Pro-Competitive Effects. The transaction is expected to generate pro-competitive efficiencies, including accelerated development of next-generation companion diagnostics assays, broader patient access to precision oncology testing, and enhanced competitive positioning against larger integrated diagnostics platforms.

In the unlikely event that a Second Request were issued, the waiting period would be extended until thirty (30) days after both parties have certified substantial compliance with the Second Request. Compliance with a Second Request typically requires four to six months, though timelines vary depending on the scope of the request and the volume of responsive materials. We do not believe this scenario is likely, but we will monitor the filing closely following submission.

D. Impact on Transaction Timeline

The following timeline summarizes the key dates and milestones relevant to the HSR process and the overall transaction:

Even under the standard thirty-day waiting period, without the benefit of early termination, the HSR waiting period would expire approximately six weeks before the target closing date, providing ample time for the parties to satisfy the HSR condition and proceed to closing. Early termination, if granted, would further accelerate the path to closing.

The parties should proceed to satisfy other closing conditions in parallel with the HSR process, including:

• Obtaining consent from Vantage Molecular Sciences, Inc. to assignment of the co-exclusive license agreement for certain OncuPath reagent formulations (status: pending; expected timeline: four to six weeks);

• Obtaining landlord consent from Towne Centre Properties LLC for assignment of the laboratory lease at 4150 Campus Point Court, San Diego, California (status: pending; expected timeline: four to eight weeks);

• Initiating the CLIA certificate transfer process with CMS for the OncuPath CLIA laboratory;

• Filing the FDA establishment registration update and device listing transfer for the OncuPath product line.

IX. Coordination with Buyer's Counsel

Effective coordination between our firm and Buyer's counsel, Whitfield Sayer & Gregg LLP, is essential to ensure that both parties' HSR filings are complete, consistent, and filed simultaneously. We recommend the following coordination steps:

1. Draft Sharing. Calderwood & Harkness will share drafts of GDT/Pinnacle's HSR Form with Whitfield Sayer & Gregg for review and consistency on overlapping items, including the transaction description, purchase price calculation, description of acquired assets, and NAICS code classifications. Buyer's counsel will reciprocally share drafts of Meridian's filing.

2. Mutual Agreement on Early Termination. Both parties should confirm their mutual agreement to request early termination of the waiting period in their respective filings. We have discussed this with Jonathan Whitfield, and Buyer's counsel has confirmed that Meridian intends to request early termination.

3. Item 4 Document Coordination. Calderwood & Harkness will advise GDT's General Counsel, Rebecca Chiang, and Pinnacle's Board Chair, Nathaniel Hargrove, regarding the scope of the Item 4 document obligation and the need to identify, preserve, and produce all responsive documents. Item 4 documents prepared by or for GDT officers and directors — including board presentations, management analyses, and financial advisor materials — must be collected and reviewed for responsiveness. Buyer's counsel will separately coordinate the collection and production of Meridian's Item 4 documents.

4. Filing Logistics. Both filings should be submitted electronically through the FTC's e-filing system on May 18, 2023. We will coordinate with Buyer's counsel to confirm simultaneous submission.

5. Ongoing Communication. Following submission, both firms should maintain open lines of communication regarding any questions or requests from the FTC or DOJ, including any informal inquiries or voluntary access letter requests that may arise during the review process.

X. Client Action Items

To ensure timely and complete filing of the HSR Notification and Report Form, we request that the client and its affiliates take the following actions on an expedited basis:

1. Item 4 Document Collection. Rebecca Chiang, GDT's General Counsel, and Nathaniel Hargrove, Pinnacle Board Chair, should oversee the compilation of all documents responsive to Item 4 of the HSR Form. This includes, without limitation, board materials from the May 8, 2023 GDT Board of Directors meeting at which the transaction was approved, any written consents or resolutions relating to the transaction, and any strategic planning or competitive analysis documents prepared by or for GDT officers or directors in connection with the OncuPath divestiture. Materials prepared by GDT management — including analyses of market shares, competitor assessments, and growth projections for the OncuPath Business — should also be collected and reviewed.

2. Brindoval Partners Materials. Victor Sandoval (Managing Director) and Elaine Cho (Vice President) at Brindoval Partners LLC should be contacted to collect copies of any investment banker presentations, competitive analyses, valuation analyses, buyer landscape assessments, or other materials prepared by Brindoval in connection with the OncuPath sale process that are responsive to the Item 4 requirement. Any presentations made to GDT's Board of Directors or to Pinnacle's Investment Committee should be included.

3. UPE Confirmation. Pinnacle should confirm the organizational and ownership structure of Pinnacle Biosciences Partners GP III, LLC for purposes of the UPE determination. Specifically, we need to confirm (i) the ownership interests (percentage and class) held by each managing partner (Nathaniel Hargrove and Priya Ramanathan) in PBP GP III, LLC, (ii) whether any single individual or entity holds a 50% or greater interest in PBP GP III, LLC, and (iii) whether there are any governance arrangements that would vest control of PBP GP III, LLC in a single individual or entity.

4. Signature Pages. Authorized signatories for GDT and for PBP GP III, LLC should execute the signature pages for the HSR Notification and Report Form. The form must be signed by the UPE or an authorized representative. We will circulate the signature pages for execution once the filing is substantially complete.

5. Filing Fee. Confirm that the filing fee obligation rests with the Buyer pursuant to Section 8.3(b) of the APA and coordinate with Buyer's counsel to ensure timely payment of the $125,000 filing fee.

6. Revenue and Financial Data. GDT's finance team should prepare and provide (i) GDT consolidated revenue data by NAICS code for FY 2022, (ii) revenue data for the OncuPath Business for FY 2022, and (iii) GDT consolidated balance sheet data as of the most recently completed fiscal year. Pinnacle should provide comparable data for the PBP GP III/PBP III person, including aggregated revenue and asset data for all entities within the Pinnacle-controlled group.

We request that all responsive documents and information be provided to us no later than May 16, 2023, to allow sufficient time for review, preparation of the filing, and submission on the target filing date of May 18, 2023.

XI. Post-Filing Update

Added May 19, 2023; Updated June 23, 2023; Further Updated August 9, 2023

A. Filing Confirmation

Both parties filed their respective HSR Notification and Report Forms on May 18, 2023, as planned. Meridian's filing was submitted by Whitfield Sayer & Gregg LLP, and GDT/Pinnacle's filing was submitted by Calderwood & Harkness LLP. Both filings were submitted electronically through the FTC's e-filing system.

The filings were accepted as complete by the FTC and DOJ. The thirty-day statutory waiting period commenced on May 19, 2023. Early termination of the waiting period was requested in both filings.

The $125,000 filing fee was paid by Meridian in accordance with Section 8.3(b) of the APA.

B. Early Termination Granted

The Federal Trade Commission granted early termination of the HSR Act waiting period effective June 22, 2023. The grant of early termination was published on the FTC's website on the same date. No Second Request for additional information or documentary material was issued by either the FTC or the DOJ during the review period.

As a result of the grant of early termination, the HSR Act condition to closing under the APA has been satisfied. The transaction is no longer subject to any waiting period requirement under the HSR Act, and the parties may proceed to consummate the acquisition upon satisfaction of all remaining closing conditions.

As of the date of the grant of early termination (June 22, 2023), the remaining material closing conditions under the APA were as follows:

• Vantage Molecular Sciences License Consent. Consent from Vantage Molecular Sciences, Inc. to the assignment of the co-exclusive license agreement for certain OncuPath reagent formulations. This consent was subsequently obtained on July 14, 2023.

• Towne Centre Properties Landlord Consent. Consent from Towne Centre Properties LLC to the assignment of the laboratory lease at 4150 Campus Point Court, San Diego, California. This consent was subsequently obtained on July 28, 2023.

All material closing conditions under the APA were satisfied by late July 2023. The transaction closed on August 8, 2023, one week after the original target closing date of August 1, 2023. The slight delay was attributable to the time required to finalize the Towne Centre landlord consent and related lease assignment documentation.

XII. Conclusion

The $140,000,000 asset purchase of the OncuPath™ companion diagnostics assay line by Meridian Precision Diagnostics, Inc. from Genome Dx Therapeutics Inc. was reportable under the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended. Both the size-of-transaction test (total consideration of $140,000,000 exceeded the 2023 threshold of $111.4 million) and the size-of-person test (both parties independently exceeded the applicable $222.7 million and $22.3 million thresholds) were satisfied. No statutory or regulatory exemption applied to relieve the parties of the filing obligation.

Premerger notification was filed by both parties on May 18, 2023. The FTC granted early termination of the thirty-day waiting period effective June 22, 2023, clearing the HSR Act condition well in advance of the actual closing date. No Second Request was issued, and no substantive antitrust issues arose during the review period. The transaction closed on August 8, 2023.

This memorandum may be updated as needed to reflect any subsequent developments.

Please contact me with any questions regarding this analysis.

Prepared by:

Andrew Fitzpatrick Associate Calderwood & Harkness LLP 555 South Hope Street, Suite 4400 Los Angeles, CA 90071 Tel: (213) 555-4872

Email: a.fitzpatrick@calderwoodharkness.com

Reviewed by:

James Prentice Partner Calderwood & Harkness LLP 555 South Hope Street, Suite 4400 Los Angeles, CA 90071 Tel: (213) 555-4801

MEMORANDUM
PRIVILEGED AND CONFIDENTIAL ATTORNEY WORK PRODUCT
TO: James Prentice, Partner; Sandra Tung, Partner; Tiffany Rosenthal, Senior Associate
FROM: Andrew Fitzpatrick, Associate
DATE: May 15, 2023
RE: Hart-Scott-Rodino Antitrust Improvements Act — Filing Analysis for the OncuPath™ Asset Divestiture
Matter No.: 1013-00006&A-4471
Client: Genome Dx Therapeutics Inc.
Right-click to update Table of Contents
I. Executive Summary
The purpose of this memorandum is to analyze the applicability of the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended (the "HSR Act"), 15 U.S.C. § 18a, to the proposed acquisition by Meridian Precision Diagnostics, Inc. ("Buyer" or "Meridian") of certain assets constituting the OncuPath™ companion diagnostics assay line (the "OncuPath Business") from our client, Genome Dx Therapeutics Inc. ("Seller" or "GDT"), pursuant to that certain Asset Purchase Agreement dated May 11, 2023 (the "APA"). This analysis addresses the threshold filing requirements, the identification of the relevant persons and ultimate parent entities, the applicability of any statutory or regulatory exemptions, and the procedural steps and timeline for compliance with the premerger notification obligations under the HSR Act and its implementing regulations, 16 C.F.R. Parts 801–803.
Conclusion. Based on the analysis set forth below, the proposed transaction is reportable under the HSR Act, and both parties are required to file premerger notification with the Federal Trade Commission ("FTC") and the Antitrust Division of the United States Department of Justice ("DOJ") prior to consummation of the acquisition. The transaction satisfies both the size-of-transaction test and the size-of-person test under the 2023 filing thresholds. No statutory or regulatory exemption relieves the parties of the obligation to file.
The total consideration for the OncuPath Business is $140,000,000, comprising $126,000,000 in cash payable at closing and up to $14,000,000 in contingent earnout payments tied to the achievement of two specified clinical milestones. Even excluding the contingent earnout payments and considering only the closing cash consideration, the size-of-transaction threshold of $111.4 million (as adjusted for 2023) is exceeded. Both parties independently satisfy the applicable size-of-person thresholds by substantial margins.
Recommendation. We recommend that HSR Notification and Report Forms be filed promptly on behalf of both the acquiring person and the acquired person, with both filings requesting early termination of the statutory thirty-day waiting period. Given the complementary nature of the parties' respective product portfolios and the fragmented competitive landscape in the companion diagnostics market, we assess the risk of a Second Request as low and believe early termination is likely to be granted. We recommend a target filing date of May 18, 2023, which is within ten business days of the execution of the APA and well in advance of the target closing date of August 1, 2023.
Note — Post-Filing Update: This memorandum has been supplemented with a post-filing update in Section XI reflecting events subsequent to the original date of this analysis. Both parties filed their respective HSR Notification and Report Forms on May 18, 2023. The FTC granted early termination of the waiting period effective June 22, 2023. No Second Request was issued. The transaction closed on August 8, 2023.
II. Transaction Overview
A. The Seller
Genome Dx Therapeutics Inc. ("GDT") is a Delaware corporation headquartered at 4150 Campus Point Court, Suite 400, San Diego, California 92121. GDT develops and commercializes genomic profiling assays for oncology and rare-disease applications. The company's product portfolio includes multi-gene expression assays, next-generation sequencing panels, and companion diagnostics used in the selection of targeted therapies across multiple solid tumor types. For the fiscal year ended December 31, 2022, GDT reported total revenue of approximately $312,000,000.
GDT's majority equity sponsor is Pinnacle Biosciences Partners Fund III, L.P. ("Pinnacle" or "PBP III"), a Delaware limited partnership that holds approximately 68.4% of GDT's outstanding common stock. PBP III is a growth equity fund focused on investments in the life sciences, diagnostics, and digital health sectors. The general partner of PBP III is Pinnacle Biosciences Partners GP III, LLC ("PBP GP III"), a Delaware limited liability company. The managing partners of PBP GP III are Nathaniel Hargrove and Priya Ramanathan. Pinnacle manages approximately $4.2 billion in assets under management across four funds and maintains its principal office at 600 Lexington Avenue, Suite 3100, New York, New York 10022.
B. The Buyer
Meridian Precision Diagnostics, Inc. ("Meridian" or "MPD") is a Delaware corporation headquartered at 2400 Meridian Parkway, Suite 300, Durham, North Carolina 27713 (Research Triangle Park). Meridian develops and commercializes precision diagnostics platforms, including CLIA-validated laboratory-developed tests, immunohistochemistry-based companion diagnostics, and liquid biopsy assays used in oncology, cardiology, and autoimmune disease. For the fiscal year ended December 31, 2022, Meridian reported revenue of approximately $589,000,000 and earnings before interest, taxes, depreciation, and amortization ("EBITDA") of approximately $104,000,000.
Based on information available to us as of the date of this memorandum, Meridian does not appear to be controlled by a parent entity or controlling stockholder; it is treated as a standalone corporation and as its own ultimate parent entity for purposes of the HSR Act analysis.
C. The Transaction
Pursuant to the APA, Meridian will acquire all assets, intellectual property, contracts, inventory, equipment, regulatory filings, and goodwill exclusively related to GDT's OncuPath™ companion diagnostics assay line (collectively, the "OncuPath Business"). The OncuPath Business encompasses a suite of tissue-based and blood-based companion diagnostic assays designed to identify patients likely to respond to specific targeted oncology therapies. For FY 2022, the OncuPath Business generated revenue of approximately $47,600,000.
The total purchase price is $140,000,000, structured as follows:
(i) Closing Cash Payment. $126,000,000, payable by Meridian at closing by wire transfer of immediately available funds to an account designated by GDT.
(ii) Earnout Payments. Up to $14,000,000 in contingent milestone-based payments, consisting of:
• Milestone 1 Payment: $8,000,000, payable upon FDA clearance or approval of the OncuPath-HER3™ assay on or before August 8, 2025; and
• Milestone 2 Payment: $6,000,000, payable upon assignment of a CMS HCPCS code and first Medicare reimbursement for OncuPath-HER3™ on or before August 8, 2026.
The APA was executed on May 11, 2023, with a target closing date of August 1, 2023.
D. Transaction Advisors and Financing
Meridian's outside legal counsel is Whitfield Sayer & Gregg LLP, Charlotte, North Carolina, with Jonathan Whitfield serving as lead partner and Rachel Dempsey as senior associate. GDT's financial advisor for the sale process is Brindoval Partners LLC, Los Angeles, California, with Victor Sandoval, Managing Director, leading the engagement. GDT is represented by our firm, Calderwood & Harkness LLP.
Meridian's acquisition financing is being provided by Summit National Bank, N.A., pursuant to a committed term loan facility in the amount of $95,000,000 (the "Acquisition Facility"). The balance of the closing consideration is expected to be funded from Meridian's existing cash on hand and revolving credit facility.
III. HSR Act Statutory Framework
A. Overview of the HSR Act and Premerger Notification Requirements
Section 7A of the Clayton Act, 15 U.S.C. § 18a, as amended by the Hart-Scott-Rodino Antitrust Improvements Act of 1976, Pub. L. No. 94-435, Title II, 90 Stat. 1390 (1976), requires that parties to certain acquisitions of voting securities, assets, or interests in unincorporated entities file premerger notification with the FTC and the Antitrust Division of the DOJ and observe a statutory waiting period before consummating the proposed transaction. The HSR Act was enacted to provide the federal antitrust enforcement agencies with advance notice of significant mergers and acquisitions so that they may investigate and, where appropriate, challenge potentially anticompetitive transactions before consummation rather than attempting to unscramble completed transactions after the fact.
The HSR Act and its implementing regulations, promulgated by the FTC at 16 C.F.R. Parts 801 through 803, establish a system of threshold tests to determine whether a particular transaction triggers the filing obligation. The regulatory framework prescribes the content and format of the HSR Notification and Report Form (the "HSR Form") that must be filed by each party, the calculation of the applicable waiting period, the procedures for early termination and extension of the waiting period, and the consequences of noncompliance.
Both the acquiring person and the acquired person are required to file separate HSR Forms. In the context of the present transaction, the acquiring person is Meridian (acting through its ultimate parent entity, which, as discussed in Section V below, is Meridian itself), and the acquired person is GDT (acting through its ultimate parent entity, which, as discussed in Section V below, is Pinnacle Biosciences Partners GP III, LLC). Failure to file when required, or failure to observe the waiting period, may result in civil penalties of up to $50,120 per day (as adjusted for inflation) for each day of noncompliance, as well as potential injunctive relief. See 15 U.S.C. § 18a(g)(1).
B. Applicability Tests — Two-Part Threshold Analysis
The HSR Act establishes two independent tests that must be satisfied for the premerger notification requirement to apply: (1) the size-of-transaction test and (2) the size-of-person test. Both tests incorporate dollar thresholds that are adjusted annually by the FTC to account for changes in the gross national product. The 2023 thresholds, which became effective on February 27, 2023, are the thresholds applicable to this analysis.
As a general matter, the size-of-transaction test is satisfied if, as a result of the proposed acquisition, the acquiring person would hold voting securities, assets, or non-corporate interests valued in excess of the applicable threshold. If the transaction value exceeds the higher size-of-transaction threshold (which, for 2023, is $445.5 million), the transaction is reportable regardless of the sizes of the parties, and the size-of-person test does not apply. If the transaction value exceeds the lower threshold ($111.4 million for 2023) but does not exceed the higher threshold, the size-of-person test must also be satisfied: one party must have total assets or annual net sales of at least $222.7 million, and the other party must have total assets or annual net sales of at least $22.3 million (using 2023 thresholds).
C. The Waiting Period
Upon the filing of complete HSR Forms by both parties, a statutory waiting period commences. The standard waiting period is thirty (30) calendar days, running from the day after the date on which both parties' filings have been received by both the FTC and the DOJ. A shorter fifteen-day waiting period applies to cash tender offers and certain acquisitions from bankruptcy proceedings; neither shortened period is applicable to the present transaction, which is structured as an asset purchase agreement.
During the waiting period, the parties are prohibited from consummating the transaction. The FTC and DOJ use the waiting period to conduct an initial review of the transaction and determine whether further investigation is warranted. If neither agency takes action during the initial waiting period, the waiting period expires and the parties are free to close.
Either agency may, during the initial waiting period, issue a request for additional information and documentary material (commonly referred to as a "Second Request"), which has the effect of extending the waiting period until thirty (30) days after both parties have certified substantial compliance with the Second Request. Second Requests are resource-intensive and can add several months to the preclosing timeline.
Alternatively, either or both parties may request early termination of the waiting period on their HSR Forms. If the reviewing agency determines that no further investigation is warranted, it may grant early termination, which is publicly announced on the FTC's website.
IV. Size-of-Transaction Test
A. 2023 Filing Thresholds
As revised for 2023 pursuant to the FTC's annual adjustment published in the Federal Register at 88 Fed. Reg. 5,572 (January 27, 2023), the HSR Act filing thresholds are as follows:
A transaction is potentially reportable if it is valued at more than $111.4 million (subject to the size-of-person test). A transaction valued at more than $445.5 million is reportable regardless of the sizes of the persons involved.
B. Determination of Transaction Value for Asset Acquisitions
For acquisitions of assets, the "size of the transaction" is determined under 16 C.F.R. § 801.10, which provides that the value of the assets to be acquired is the aggregate total amount of voting securities and assets to be held as a result of the acquisition. In the case of an asset purchase, the acquisition price is generally the greater of the fair market value of the assets being acquired or the contractually agreed-upon purchase price. See 16 C.F.R. § 801.10(b).
In this transaction, the total contractual consideration is $140,000,000, comprising the $126,000,000 closing cash payment and the maximum $14,000,000 in contingent earnout payments.
Treatment of Earnout Payments. A threshold question in calculating the transaction value is whether the contingent earnout payments should be included. Under FTC guidance and informal interpretations, contingent consideration is generally included in the determination of the acquisition price at the maximum amount payable when the contingent payments represent binding contractual obligations that will become due upon the occurrence of specified events. Here, the earnout payments under the APA are contractually committed: Meridian is obligated to pay up to $8,000,000 upon FDA clearance or approval of OncuPath-HER3™ and up to $6,000,000 upon CMS HCPCS code assignment and first Medicare reimbursement. Although the payments are contingent upon the achievement of specified clinical milestones, the obligation to pay is a binding contractual commitment, and the FTC's Premerger Notification Office has consistently taken the position that such amounts should be included in the transaction value at the maximum amount potentially payable.
Accordingly, the size of the transaction for HSR purposes is calculated as follows:
Closing Cash Payment: $126,000,000 Maximum Earnout: $14,000,000 Total Transaction Value: $140,000,000
We note that even if the earnout payments were excluded entirely from the calculation — which we do not believe to be the correct treatment under the applicable guidance — the closing cash payment alone ($126,000,000) independently exceeds the $111.4 million threshold. The inclusion or exclusion of the earnout is therefore not outcome-determinative for the size-of-transaction analysis.
The total transaction value of $140,000,000 exceeds the $111.4 million minimum threshold but does not exceed the $445.5 million higher threshold. Consequently, the transaction is not reportable solely on the basis of the size-of-transaction test; the size-of-person test must also be satisfied.
C. Conclusion on Size-of-Transaction
The size-of-transaction test is satisfied. The total consideration of $140,000,000 exceeds the 2023 filing threshold of $111.4 million. Because the transaction value does not exceed $445.5 million, the analysis must proceed to the size-of-person test, which is addressed in Section V below.
V. Size-of-Person Test
A. Applicable Threshold
Because the transaction is valued between $111.4 million and $445.5 million, the size-of-person test must also be met for the filing obligation to be triggered. Under the 2023 thresholds, the size-of-person test requires that one person involved in the transaction have total assets or annual net sales of at least $222.7 million and that the other person have total assets or annual net sales of at least $22.3 million. The "person" for HSR purposes includes the ultimate parent entity ("UPE") and all entities controlled by the UPE.
B. Identification of the "Persons" and Ultimate Parent Entities
1. The Acquired Person
GDT is the entity whose assets are being sold in the proposed transaction. However, under 16 C.F.R. § 801.1(a)(1), the "person" for HSR purposes is defined broadly to include the ultimate parent entity and all entities that the ultimate parent entity controls. "Control" is defined in 16 C.F.R. § 801.1(b) as, among other things, holding 50% or more of the outstanding voting securities of an issuer or having the contractual power to designate 50% or more of the directors of a corporation.
Pinnacle Biosciences Partners Fund III, L.P. holds approximately 68.4% of GDT's outstanding common stock and therefore controls GDT within the meaning of the HSR regulations. As a limited partnership, PBP III is in turn controlled by its general partner, Pinnacle Biosciences Partners GP III, LLC. The UPE analysis under the HSR rules requires looking through the ownership chain to identify the entity at the top of the chain that is not itself controlled by any other entity.
PBP GP III, LLC is managed by its two managing partners, Nathaniel Hargrove and Priya Ramanathan. Under the HSR regulations, a natural person is not treated as an "entity" for purposes of the control analysis unless the natural person holds 50% or more of the outstanding voting securities or interests of an entity. Based on available information, neither Mr. Hargrove nor Ms. Ramanathan individually holds a 50% or greater interest in PBP GP III, LLC. Accordingly, PBP GP III, LLC is not controlled by any single natural person or entity and is therefore the ultimate parent entity of GDT for HSR purposes.
We recommend confirming the ownership and governance structure of PBP GP III, LLC with Pinnacle's counsel prior to filing. If either managing partner holds a 50% or greater interest, that individual would be the UPE, and the filing would need to be made in his or her name. For purposes of this analysis, we treat PBP GP III, LLC as the UPE.
The "acquired person" for HSR purposes therefore includes PBP GP III, LLC, PBP III, GDT, and all other entities controlled directly or indirectly by PBP GP III, LLC. The size-of-person analysis for the acquired person will aggregate the total assets and annual net sales of all such entities.
2. The Acquiring Person
Meridian Precision Diagnostics, Inc. is the entity acquiring the OncuPath Business. Based on the information available to us, Meridian is a standalone corporation that is not controlled by any parent entity, controlling stockholder, or other entity holding 50% or more of its outstanding voting securities. Accordingly, Meridian is treated as its own UPE, and the "acquiring person" for HSR purposes consists of Meridian and all entities it controls.
We have not identified any subsidiaries or controlled entities of Meridian that would materially affect the size-of-person analysis. Should additional information regarding Meridian's corporate structure emerge in the course of preparing the filing, this analysis should be revisited.
C. Application of Size Thresholds
The size-of-person test requires that one party meet the $222.7 million threshold and the other party meet the $22.3 million threshold. The analysis is satisfied regardless of which party is measured against which prong, but for completeness we assess both:
Meridian (Acquiring Person):
• FY 2022 total revenue: approximately $589,000,000
• FY 2022 EBITDA: approximately $104,000,000
• Total assets: not independently confirmed, but given a revenue base of $589 million and the capital-intensive nature of Meridian's diagnostics platforms business, total assets are reasonably presumed to exceed $222.7 million by a wide margin
• Conclusion: Meridian satisfies the "at least $222.7 million" prong of the size-of-person test
Pinnacle/GDT (Acquired Person):
• GDT FY 2022 total revenue: approximately $312,000,000
• Pinnacle aggregate assets under management (across four funds): approximately $4.2 billion
• Either GDT's revenue alone ($312 million) or Pinnacle's aggregate assets independently exceeds the $222.7 million threshold, and both far exceed the $22.3 million threshold
• Conclusion: The acquired person satisfies the "at least $22.3 million" prong of the size-of-person test — and, indeed, independently satisfies the $222.7 million prong as well
Both prongs of the size-of-person test are satisfied regardless of which party is assigned to which threshold. Each party independently exceeds both the $222.7 million and $22.3 million thresholds.
D. Conclusion on Size-of-Person
The size-of-person test is met. Both the acquiring person and the acquired person far exceed the applicable 2023 thresholds. When combined with the satisfaction of the size-of-transaction test as set forth in Section IV, the proposed transaction triggers the premerger notification obligation under the HSR Act.
VI. Exemptions Analysis
A. Potentially Applicable Exemptions
The HSR Act and its implementing regulations provide a number of exemptions from the filing requirement for certain categories of transactions. See 15 U.S.C. § 18a(c); 16 C.F.R. Part 802. We have reviewed each potentially applicable exemption to determine whether any would relieve the parties of the obligation to file in connection with this transaction.
Section 802.1 — Acquisition of Realty. This exemption applies to the acquisition of certain categories of real property, including new facilities for the production of goods or services and unproductive real property. The assets being acquired in the OncuPath Business are primarily intellectual property, contracts, equipment, regulatory filings, inventory, and goodwill. Although certain real property interests (e.g., leasehold interests in laboratory space) may be among the transferred assets, the transaction is not primarily or solely an acquisition of realty within the meaning of this exemption. This exemption does not apply.
Section 802.2 — Acquisitions of Goods and Realty in the Ordinary Course of Business. This exemption applies to acquisitions of goods transferred in the ordinary course of business. The acquisition of an entire business line — including intellectual property, regulatory filings, contracts, and goodwill — is plainly not an acquisition of goods in the ordinary course. This exemption does not apply.
Section 802.4 — Transfers to or from Federal, State, or Local Agencies. Neither party is a governmental agency. This exemption does not apply.
Section 802.5 — Acquisitions by Certain Regulated Entities. While the companion diagnostics industry is subject to FDA regulation and CMS reimbursement policies, neither party is an entity of the type regulated under the exemption provisions (e.g., banks, savings institutions, or common carriers). No exemption for assets used in regulated industries would apply to companion diagnostics. This exemption does not apply.
Section 802.6 — Foreign Assets and Section 802.50–802.52 — Foreign Transactions. The OncuPath Business is conducted within the United States, and both parties are domestic corporations. The foreign transaction exemptions are inapplicable.
Section 802.30 — Intraperson Transactions. The transaction is between unaffiliated parties and does not involve a transfer within a single corporate family. This exemption does not apply.
Section 802.63 — Certain Acquisitions of Carbon-Based Mineral Reserves. Not applicable.
We have also considered whether any other exemption under 15 U.S.C. § 18a(c) might apply, including exemptions for acquisitions solely for investment purposes (not applicable, as Meridian is acquiring the OncuPath Business for operational purposes) and exemptions for acquisitions of non-voting securities (not applicable, as the transaction is an asset purchase, not an acquisition of non-voting securities). None of the statutory or regulatory exemptions apply to the proposed transaction.
B. Conclusion on Exemptions
No applicable HSR Act exemption exists that would relieve either party of the obligation to file. The transaction is reportable, and premerger notification is required.
VII. Filing Requirements and Procedures
A. Filing Parties
Both the acquiring person (Meridian, through its UPE) and the acquired person (Pinnacle/GDT, through the UPE of GDT, i.e., PBP GP III, LLC) are required to file HSR Notification and Report Forms. Each party files its own form, and both filings must be submitted to both the FTC and the DOJ.
Our firm, Calderwood & Harkness LLP, will coordinate the preparation and filing of the HSR Form on behalf of our client, GDT, and its UPE, Pinnacle Biosciences Partners GP III, LLC. Buyer's counsel, Whitfield Sayer & Gregg LLP (Jonathan Whitfield, lead partner, and Rachel Dempsey, senior associate), will coordinate the preparation and filing of Meridian's HSR Form.
To ensure that the thirty-day waiting period commences promptly and simultaneously, both filings should be submitted on the same date. We recommend coordinating with Buyer's counsel to align on a mutual filing date of May 18, 2023.
B. Filing Fee
The HSR Act requires payment of a filing fee, the amount of which is determined by the value of the transaction. For 2023, the fee schedule (as adjusted pursuant to the Consolidated Appropriations Act, 2023) is as follows:
The total transaction value of $140,000,000 falls within the first tier, and the applicable filing fee is $125,000. Under standard practice, the filing fee is paid by the acquiring person. Section 8.3(b) of the APA provides that the Buyer shall be responsible for the HSR Act filing fee. We should confirm this allocation with the deal team and with Buyer's counsel prior to filing to avoid any delays.
C. Information Required in the Filing
The HSR Notification and Report Form requires extensive information from each filing party, including, but not limited to, the following:
Item 1 — Identification. Name, address, and organizational information of the filing person, the UPE, and all entities within the person.
Item 2 — Acquisition. Description of the transaction, including the parties, the structure, the consideration, the anticipated date of consummation, and the identity of all entities whose assets or voting securities are being acquired.
Item 3 — Financial Information. Revenue data, balance sheet information, and NAICS code classifications for the filing person and the acquired entity. Relevant NAICS codes for the OncuPath Business and Meridian's diagnostics operations include 325413 (In-Vitro Diagnostic Substance Manufacturing) and 621511 (Medical Laboratories).
Item 4 — Documents. Item 4 is among the most significant components of the filing. It requires the production of all documents — including studies, surveys, analyses, and reports — that were prepared by or for any officer or director (or, in the case of the acquiring person, prepared by or for the supervisory deal team lead) for the purpose of evaluating or analyzing the acquisition with respect to market shares, competition, competitors, markets, potential for sales growth, or expansion into product or geographic markets. This includes:
• Board of directors presentations and materials from the May 8, 2023 GDT board meeting at which the transaction was approved;
• Investment banker analyses, competitive landscape assessments, and valuation presentations prepared by Brindoval Partners LLC (Victor Sandoval, Managing Director; Elaine Cho, Vice President) in connection with the sale process;
• Internal management presentations, strategic planning documents, and competitive analyses prepared by GDT management relating to the OncuPath Business;
• Comparable documents prepared by or for Meridian's officers, directors, or deal team, which Buyer's counsel will be responsible for collecting and producing.
Item 5 — Prior Acquisitions. Information regarding acquisitions of entities operating in the relevant product and geographic markets completed by the filing person within the preceding five years.
Item 6 — Contracts. Copies of certain agreements between the parties, including the APA and any related agreements.
Item 7 — Subsidiaries and Affiliates. Organizational charts and entity information.
Description of Acquired Assets. The filing will include a detailed description of the assets comprising the OncuPath Business, including:
• All intellectual property, consisting of fourteen (14) issued U.S. utility patents, seven (7) pending patent applications, and three (3) registered trademarks (including the ONCUPATH™ word mark and design mark);
• All contracts assigned or to be assigned to Meridian;
• All equipment, instruments, and laboratory assets;
• All inventory of assay kits, reagents, and consumables;
• All regulatory filings and approvals, including FDA 510(k) clearances (K201847, K193215, and K210562) and PMA supplement P230014;
• FDA establishment registrations and device listings; and
• Goodwill associated with the OncuPath Business.
D. NAICS Code and Product Market Considerations
The HSR Form requires that each party identify the NAICS codes corresponding to the products and services involved in the transaction. The primary NAICS codes applicable to the OncuPath Business and Meridian's diagnostics operations are:
• 325413 — In-Vitro Diagnostic Substance Manufacturing
• 621511 — Medical Laboratories
Both GDT and Meridian operate broadly within the precision diagnostics and companion diagnostics space. However, based on our preliminary assessment of the parties' respective product portfolios, the degree of direct competitive overlap is limited. Meridian's existing CLIA-validated test menu is focused primarily on oncology panels utilizing immunohistochemistry and liquid biopsy platforms, while the OncuPath assay line employs multi-gene expression profiling and next-generation sequencing technologies. The acquisition is strategic and complementary in nature — it is designed to expand Meridian's test menu and geographic reach rather than to consolidate directly competing products.
The companion diagnostics market is highly fragmented, with numerous participants ranging from large integrated diagnostics companies (e.g., Roche/Granite Harbor & Co., Westmark Corporation Scientific, Granite Harbor Corporation/Dako) to smaller specialized assay developers. No single participant holds a dominant market share, and barriers to switching among companion diagnostics products are moderated by the role of pharmaceutical partner selection, clinical validation requirements, and payer coverage decisions. Based on these considerations, we assess the substantive antitrust risk associated with this transaction as low.
VIII. Timing Considerations and Early Termination Strategy
A. Waiting Period Mechanics
The statutory thirty-day waiting period commences on the day after the date on which both parties' complete HSR filings have been received by both the FTC and the DOJ. The waiting period is measured in calendar days, not business days. If the thirtieth day falls on a Saturday, Sunday, or federal holiday, the waiting period is extended to the next business day.
Assuming both parties file on May 18, 2023, and the filings are accepted as complete on that date, the thirty-day waiting period would commence on May 19, 2023. The standard expiration date would be June 17, 2023. However, June 17, 2023 falls on a Saturday. The following day, June 18, 2023, is a Sunday. June 19, 2023 is the Juneteenth National Independence Day federal holiday. Accordingly, the waiting period would not expire until the next business day, which is Tuesday, June 20, 2023.
B. Early Termination
Both parties may request early termination of the waiting period by checking the appropriate box on their respective HSR Forms. The FTC and DOJ grant early termination at their discretion. In practice, early termination is routinely granted for transactions that do not present competitive concerns or that fall outside the reviewing agency's current enforcement priorities. Requests for early termination are processed on a rolling basis, and the typical turnaround time ranges from approximately fifteen to twenty-five days from the date of filing, depending on the agencies' workload and the complexity of the transaction.
Given the low antitrust risk profile of this transaction — including the complementary nature of the parties' product portfolios, the fragmented market structure, and the absence of any prior antitrust enforcement actions involving either party in the diagnostics space — we recommend that both filings include a request for early termination. We expect that early termination is likely to be granted.
Upon grant of early termination, the FTC publishes a notice on its website identifying the parties and the grant date. Once early termination is granted (or the waiting period expires), the parties may proceed to consummate the transaction subject to satisfaction of all other closing conditions under the APA.
C. Second Request Risk Assessment
A Second Request for additional information and documentary material under 15 U.S.C. § 18a(e)(1)(A) is issued when the reviewing agency (FTC or DOJ) determines that additional investigation is warranted to assess the competitive implications of a proposed transaction. Second Requests are resource-intensive, typically requiring the production of large volumes of documents and data, and can extend the preclosing timeline by several months.
Based on the following factors, we assess the risk of a Second Request in connection with this transaction as low:
1. Complementary Product Portfolios. Meridian's existing diagnostics product menu and the OncuPath assay line employ distinct technology platforms and serve largely non-overlapping clinical indications. The acquisition expands Meridian's product offerings rather than consolidating competing products.
2. Fragmented Market Structure. The companion diagnostics market features numerous competitors, including both large integrated diagnostics companies and smaller specialized players. No single market participant holds a dominant share.
3. No Prior Antitrust Issues. We are not aware of any prior antitrust investigations, consent orders, or enforcement actions involving GDT, Pinnacle, or Meridian in the diagnostics space.
4. Transaction Size. While the $140 million transaction value is above the filing threshold, it is relatively modest compared to the large-scale diagnostics transactions that have historically attracted antitrust scrutiny.
5. Pro-Competitive Effects. The transaction is expected to generate pro-competitive efficiencies, including accelerated development of next-generation companion diagnostics assays, broader patient access to precision oncology testing, and enhanced competitive positioning against larger integrated diagnostics platforms.
In the unlikely event that a Second Request were issued, the waiting period would be extended until thirty (30) days after both parties have certified substantial compliance with the Second Request. Compliance with a Second Request typically requires four to six months, though timelines vary depending on the scope of the request and the volume of responsive materials. We do not believe this scenario is likely, but we will monitor the filing closely following submission.
D. Impact on Transaction Timeline
The following timeline summarizes the key dates and milestones relevant to the HSR process and the overall transaction:
Even under the standard thirty-day waiting period, without the benefit of early termination, the HSR waiting period would expire approximately six weeks before the target closing date, providing ample time for the parties to satisfy the HSR condition and proceed to closing. Early termination, if granted, would further accelerate the path to closing.
The parties should proceed to satisfy other closing conditions in parallel with the HSR process, including:
• Obtaining consent from Vantage Molecular Sciences, Inc. to assignment of the co-exclusive license agreement for certain OncuPath reagent formulations (status: pending; expected timeline: four to six weeks);
• Obtaining landlord consent from Towne Centre Properties LLC for assignment of the laboratory lease at 4150 Campus Point Court, San Diego, California (status: pending; expected timeline: four to eight weeks);
• Initiating the CLIA certificate transfer process with CMS for the OncuPath CLIA laboratory;
• Filing the FDA establishment registration update and device listing transfer for the OncuPath product line.
IX. Coordination with Buyer's Counsel
Effective coordination between our firm and Buyer's counsel, Whitfield Sayer & Gregg LLP, is essential to ensure that both parties' HSR filings are complete, consistent, and filed simultaneously. We recommend the following coordination steps:
1. Draft Sharing. Calderwood & Harkness will share drafts of GDT/Pinnacle's HSR Form with Whitfield Sayer & Gregg for review and consistency on overlapping items, including the transaction description, purchase price calculation, description of acquired assets, and NAICS code classifications. Buyer's counsel will reciprocally share drafts of Meridian's filing.
2. Mutual Agreement on Early Termination. Both parties should confirm their mutual agreement to request early termination of the waiting period in their respective filings. We have discussed this with Jonathan Whitfield, and Buyer's counsel has confirmed that Meridian intends to request early termination.
3. Item 4 Document Coordination. Calderwood & Harkness will advise GDT's General Counsel, Rebecca Chiang, and Pinnacle's Board Chair, Nathaniel Hargrove, regarding the scope of the Item 4 document obligation and the need to identify, preserve, and produce all responsive documents. Item 4 documents prepared by or for GDT officers and directors — including board presentations, management analyses, and financial advisor materials — must be collected and reviewed for responsiveness. Buyer's counsel will separately coordinate the collection and production of Meridian's Item 4 documents.
4. Filing Logistics. Both filings should be submitted electronically through the FTC's e-filing system on May 18, 2023. We will coordinate with Buyer's counsel to confirm simultaneous submission.
5. Ongoing Communication. Following submission, both firms should maintain open lines of communication regarding any questions or requests from the FTC or DOJ, including any informal inquiries or voluntary access letter requests that may arise during the review process.
X. Client Action Items
To ensure timely and complete filing of the HSR Notification and Report Form, we request that the client and its affiliates take the following actions on an expedited basis:
1. Item 4 Document Collection. Rebecca Chiang, GDT's General Counsel, and Nathaniel Hargrove, Pinnacle Board Chair, should oversee the compilation of all documents responsive to Item 4 of the HSR Form. This includes, without limitation, board materials from the May 8, 2023 GDT Board of Directors meeting at which the transaction was approved, any written consents or resolutions relating to the transaction, and any strategic planning or competitive analysis documents prepared by or for GDT officers or directors in connection with the OncuPath divestiture. Materials prepared by GDT management — including analyses of market shares, competitor assessments, and growth projections for the OncuPath Business — should also be collected and reviewed.
2. Brindoval Partners Materials. Victor Sandoval (Managing Director) and Elaine Cho (Vice President) at Brindoval Partners LLC should be contacted to collect copies of any investment banker presentations, competitive analyses, valuation analyses, buyer landscape assessments, or other materials prepared by Brindoval in connection with the OncuPath sale process that are responsive to the Item 4 requirement. Any presentations made to GDT's Board of Directors or to Pinnacle's Investment Committee should be included.
3. UPE Confirmation. Pinnacle should confirm the organizational and ownership structure of Pinnacle Biosciences Partners GP III, LLC for purposes of the UPE determination. Specifically, we need to confirm (i) the ownership interests (percentage and class) held by each managing partner (Nathaniel Hargrove and Priya Ramanathan) in PBP GP III, LLC, (ii) whether any single individual or entity holds a 50% or greater interest in PBP GP III, LLC, and (iii) whether there are any governance arrangements that would vest control of PBP GP III, LLC in a single individual or entity.
4. Signature Pages. Authorized signatories for GDT and for PBP GP III, LLC should execute the signature pages for the HSR Notification and Report Form. The form must be signed by the UPE or an authorized representative. We will circulate the signature pages for execution once the filing is substantially complete.
5. Filing Fee. Confirm that the filing fee obligation rests with the Buyer pursuant to Section 8.3(b) of the APA and coordinate with Buyer's counsel to ensure timely payment of the $125,000 filing fee.
6. Revenue and Financial Data. GDT's finance team should prepare and provide (i) GDT consolidated revenue data by NAICS code for FY 2022, (ii) revenue data for the OncuPath Business for FY 2022, and (iii) GDT consolidated balance sheet data as of the most recently completed fiscal year. Pinnacle should provide comparable data for the PBP GP III/PBP III person, including aggregated revenue and asset data for all entities within the Pinnacle-controlled group.
We request that all responsive documents and information be provided to us no later than May 16, 2023, to allow sufficient time for review, preparation of the filing, and submission on the target filing date of May 18, 2023.
XI. Post-Filing Update
Added May 19, 2023; Updated June 23, 2023; Further Updated August 9, 2023
A. Filing Confirmation
Both parties filed their respective HSR Notification and Report Forms on May 18, 2023, as planned. Meridian's filing was submitted by Whitfield Sayer & Gregg LLP, and GDT/Pinnacle's filing was submitted by Calderwood & Harkness LLP. Both filings were submitted electronically through the FTC's e-filing system.
The filings were accepted as complete by the FTC and DOJ. The thirty-day statutory waiting period commenced on May 19, 2023. Early termination of the waiting period was requested in both filings.
The $125,000 filing fee was paid by Meridian in accordance with Section 8.3(b) of the APA.
B. Early Termination Granted
The Federal Trade Commission granted early termination of the HSR Act waiting period effective June 22, 2023. The grant of early termination was published on the FTC's website on the same date. No Second Request for additional information or documentary material was issued by either the FTC or the DOJ during the review period.
As a result of the grant of early termination, the HSR Act condition to closing under the APA has been satisfied. The transaction is no longer subject to any waiting period requirement under the HSR Act, and the parties may proceed to consummate the acquisition upon satisfaction of all remaining closing conditions.
As of the date of the grant of early termination (June 22, 2023), the remaining material closing conditions under the APA were as follows:
• Vantage Molecular Sciences License Consent. Consent from Vantage Molecular Sciences, Inc. to the assignment of the co-exclusive license agreement for certain OncuPath reagent formulations. This consent was subsequently obtained on July 14, 2023.
• Towne Centre Properties Landlord Consent. Consent from Towne Centre Properties LLC to the assignment of the laboratory lease at 4150 Campus Point Court, San Diego, California. This consent was subsequently obtained on July 28, 2023.
All material closing conditions under the APA were satisfied by late July 2023. The transaction closed on August 8, 2023, one week after the original target closing date of August 1, 2023. The slight delay was attributable to the time required to finalize the Towne Centre landlord consent and related lease assignment documentation.
XII. Conclusion
The $140,000,000 asset purchase of the OncuPath™ companion diagnostics assay line by Meridian Precision Diagnostics, Inc. from Genome Dx Therapeutics Inc. was reportable under the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended. Both the size-of-transaction test (total consideration of $140,000,000 exceeded the 2023 threshold of $111.4 million) and the size-of-person test (both parties independently exceeded the applicable $222.7 million and $22.3 million thresholds) were satisfied. No statutory or regulatory exemption applied to relieve the parties of the filing obligation.
Premerger notification was filed by both parties on May 18, 2023. The FTC granted early termination of the thirty-day waiting period effective June 22, 2023, clearing the HSR Act condition well in advance of the actual closing date. No Second Request was issued, and no substantive antitrust issues arose during the review period. The transaction closed on August 8, 2023.
This memorandum may be updated as needed to reflect any subsequent developments.
Please contact me with any questions regarding this analysis.
Prepared by:
Andrew Fitzpatrick Associate Calderwood & Harkness LLP 555 South Hope Street, Suite 4400 Los Angeles, CA 90071 Tel: (213) 555-4872
Email: a.fitzpatrick@calderwoodharkness.com
Reviewed by:
James Prentice Partner Calderwood & Harkness LLP 555 South Hope Street, Suite 4400 Los Angeles, CA 90071 Tel: (213) 555-4801
Email: j.prentice@calderwoodharkness.com
PRIVILEGED AND CONFIDENTIAL — ATTORNEY WORK PRODUCT This memorandum is protected by the attorney-client privilege and the work product doctrine. It is intended solely for the use of the individuals to whom it is addressed and should not be disclosed, distributed, or copied without the prior written consent of Calderwood & Harkness LLP.
Threshold | 2023 Amount
Minimum size-of-transaction threshold | $111.4 million
Higher size-of-transaction threshold (eliminating need for size-of-person test) | $445.5 million
Size-of-person — larger person | $222.7 million (total assets or annual net sales)
Size-of-person — smaller person | $22.3 million (total assets or annual net sales)
Transaction Value | Filing Fee
More than $111.4 million but less than $222.7 million | $125,000
$222.7 million or more but less than $555.5 million | $250,000
$555.5 million or more but less than $1.111 billion | $400,000
$1.111 billion or more but less than $2.222 billion | $800,000
$2.222 billion or more but less than $5.556 billion | $2,250,000
$5.556 billion or more | $2,250,000
Event | Date
APA executed | May 11, 2023
HSR filing target (both parties) | May 18, 2023
Waiting period commencement | May 19, 2023
Standard waiting period expiration (adjusted for weekends/holidays) | June 20, 2023
Early termination (estimated, if granted) | Mid-June 2023
Target closing date | August 1, 2023

MEMORANDUM

PRIVILEGED AND CONFIDENTIAL ATTORNEY WORK PRODUCT

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