etrials Worldwide, the US-based supplier of adaptive eClinical software and services, has drawn a line under its recent turbulent history and run of quarterly losses by agreeing to be acquired by Bio-Imaging Technologies, Inc in a stock-and-cash deal valued at around US$10 million.

Rebranded in April 2008 as BioClinica, the Newtown, Pennsylvania-based Bio-Imaging Technologies was previously a product development services company specialising in medical image management for clinical trials.

It made a definitive move into the e-clinical space in March 2008, when Bio-Imaging Technologies acquired Phoenix Data Systems, a US-based supplier of electronic data capture (EDC) services and eClinical data, for US$24 million.

BioClinica has now made a tender offer for all of the outstanding shares of etrials stock, which it expects to expire on or around 15 June 2009. As of 05 May, stockholders owning around 33% of etrials’ outstanding shares had agreed to tender their shares and, if necessary, vote for approval of the merger agreement.

For each share of etrials stock, BioClinica is offering 0.124 shares of newly issued Bio-Imaging common stock, 0.076 shares of newly issued Bio-Imaging preferred stock, and US$0.15 in cash. This means etrials is getting US$0.9068 per share, a 27% premium over the company’s average closing price for the 30 days before the transaction was announced.

According to BioClinica, the acquisition should have a neutral effect on earnings per share (EPS) from continuing operations in 2009 (excluding one-time charges related to the transaction), and should be accretive to EPS in 2010.

Combined service revenues this year, including the operating results of etrials from the date of acquisition through to 31 December 2009, are expected to be in the range of US$65-US$70 million, compared with BioClinica’s previous guidance for revenues of US$60-US$63 million. The company has reiterated its guidance for full-year EPS of US$0.23 to US$0.25, excluding one-time charges related to the acquisition.

Diluted earnings per share in the first quarter of 2009 were US$0.05 versus US$0.06 in the same period of 2008. BioClinica reported first-quarter operating income of US$1.22 million, down by 25.9% year on year, on net service revenues that were 31.3% higher at US$14.5 million.

Excellent fit

Mark Weinstein, president and chief executive officer of BioClinica, said etrials was “an excellent fit with our long-term corporate strategy”. With minimal customer overlap, the acquisition also presented immediate cross-selling and new business opportunities, he noted, adding that BioClinica expected to realise “significant synergies as we integrate etrials with our eClinical Services Division”.

Peter Benton, president of BioClinica’s eClinical Services Division and former chief operating officer of etrials, said the combination “augments robust and proven EDC and data management with complementary clinical trial technology that includes interactive voice and Web response, eDiary, registry experience and Tech Transfer platforms for CRO [contract research organisation] customers, all of which will enhance our business opportunities”.

Despite a second round of restructuring last December, etrials recorded operating losses of US$5.52 million for the fourth quarter of 2008, more than double the losses of US$2.74 million seen in the final quarter of 2007. Net service revenues dropped by 25.9% to US$3.64 million. The troubled eClinical specialist had been talking about a return to profitability in 2009.