Xcell to complete Visiomed acquisition

Perth based devices company Xcell Diagnostics will finalise its acquisition of German company Visiomed this week, propelling Xcell into a leading position in skin cancer diagnostic instrumentation.

"We have signed the agreement, it's essentially just the mechanics (of the transaction) now," said Saliba Sassine, Xcell's CEO.

The deal was first announced in August last year, and Sassine said it had taken a while for the company to work through all the details of the transaction, which involves a combination of shares, options, cash and royalties. German group ZN will become Xcell's major shareholder, with 19.9 per cent of the shares, as a result.

Visiomed is a valuable acquisition for Xcell as it provides them with a product -- the microDERM system which comprises both image-capture and processing components -- already on the market in Europe and ready to be pushed forward in Australia and the US, where it has already been given FDA Class I approval.

An attractive aspect of the technology is the pipeline of products in development, said Sassine, with three new dermatological applications based on the microDERM technology to be ready for release in the next two years. One of these, an instrument to analyse hair regrowth and thickness, is currently going through the final stages of approval in Europe.

The company plans to retain its headquarters in Australia, and run Visiomed as a wholly-owned subsidiary in Germany. For the time being, Sassine said, R&D for the microDERM platform would remain in Germany, in part because of support from the German government. But within the next 12 to 18 months, Xcell plans to expand back into Australia, in part because of the low research costs.

Last year, Xcell discontinued its R&D support of skin cancer diagnostic technology being developed at the University of Western Australia, citing a need to focus on the market-ready microDERM products.

The acquisition has also meant changes at the executive level of the company, with Visiomed's Dr Andreas Rick appointed as the chief technology officer, and Dr Dennis Thiele, formerly of the WA Department of Agriculture, as chief operating officer. Two new non-executive directors will come from ZN -- CEO Marcel Yon and COO Hartmuth von Maltzhan -- and Sassine will also join the Xcell board. Dr Chris Quirk will step down from the board but will remain involved with the company as the coordinator of an Australian clinical trial of the microDERM system.