Source - RNS
RNS Number : 9946I
Instem plc
05 September 2016

Instem plc 




Earnings Enhancing Acquisition of Notocord® Systems SAS ("Notocord")


Acquisition of software provider in pre-clinical studies


Instem (AIM: INS.L), a leading provider of IT solutions to the global early development healthcare market, announces that it has acquired Notocord® (the "Acquisition").  The total consideration, to be satisfied in cash, will be up to €4.2m, net of any cash acquired adjusted for a normalised level of working capital.  The Acquisition is expected to be immediately earnings enhancing.


The consideration comprises €2.0m on completion (the "Initial Consideration"), and up to a further €2.2m, which is payable contingent upon the achievement of certain targets, including the future financial performance of Notocord (the "Earn Out"). Further information on the terms of the Acquisition is set out below.


About Notocord 

Founded in 1989, Notocord® is based in Paris, France and New Jersey, United States with 16 employees. The company provides software solutions for data acquisition and analysis and is a highly respected name in the life sciences software industry.


Notocord® solutions are used every day by top scientists for new drug development research within discovery, safety pharmacology and toxicology studies. Its most widely used solution is Notocord-hem®, a telemetry-based safety pharmacology data collection system for preclinical studies, which is recognised as a leading software solution for cardiovascular, respiratory, electrophysiology and nervous system research.


Notocord® has sold more than 1,500 licences around the world to major pharmaceutical companies, contract research laboratories, hospitals and academic research centres. Customers include Sanofi, Merck & Co and Pfizer.


In its last financial year ended 31st December 2015, Notocord® reported sales of €2.25m and operating profits of €0.7m and the Acquisition is expected to be earnings enhancing in 2016. As at 31 May 2016, Notocord® had pro forma net assets of approximately €0.03m, with no debt.  The pro forma net assets are based on a normalised level of working capital and exclude cash distributed to the shareholders of Notocord prior to completion.  


Acquisition Rationale 

An important element of Instem's stated strategy is to consolidate key niche software providers across the Pharmaceutical, Government Research, Medical Device, Chemical and Agrochemical industries to extend its market leadership in data acquisition, management, analysis and transmission of early development data. The acquisition of Notocord® is a further significant step in the execution of this strategy. Ultimately, Instem's clients will be able to bring life-enhancing products to market quicker and more cost effectively.


Version 3.1 of the Standard for the Exchange of Non-clinical Data ("SEND") was published on 27 June 2016 and includes the requirements for Safety Pharmacology studies for the first time, in addition to the requirement for electrocardiogram data associated with toxicity studies supported by the current SEND 3.0 standard.


Following the acquisition of Notocord®, Instem is uniquely positioned to address the requirements of SEND across the key application areas of pre-clinical drug research data collection, analysis, management and submission of test data to the FDA under the new SEND mandate.


The Acquisition will enable Instem to enhance its existing submit™ solution, accelerate the integration of other key data collection sources and further differentiate this market leading solution.  It will also increase Instem's deep domain expertise in another key area of data required in a SEND submission, which is a strong competitive advantage for Instem's growing out-sourced SEND conversion services business.


Notocord® will immediately be able to capitalise on Instem's global marketing, sales and support capabilities while ensuring that its track record for delivering high-quality and highly reliable products continues to meet all of its clients' requirements.


The Notocord® team and its applications will be integrated into Instem's Preclinical Study Management Solutions group, which provides focused software solutions that empower organisations of all sizes to more effectively collect, review, analyse and manage preclinical safety evaluation study data.


Terms of the Acquisition

The Initial Consideration of €2.0m is being funded from existing cash resources following the fundraise earlier in 2016.  The Earn Out of up to €2.2m will also be satisfied in cash, if payable, and comprises:


·    up to €0.85m, payable in March 2017 dependent on Notocord® achieving certain revenue and earnings targets for the year ending 31 December 2016;

·    up to €0.40m, payable during 2017 dependent on Notocord® delivering certain product line business targets;

·    approximately €0.20m, payable during 2017, dependent on the receipt of R&D tax credits for qualifying investments made by Notocord between 1st January 2016 and 2nd September 2016; and

·    up to a further €0.75m, payable in March 2018, dependent on Notocord® delivering certain product line business targets.


Philippe Zitoun, founder and Chief Executive Officer of Notocord®, said: "Our mission all along was to create technology that was easier and faster to use so our clients can do what they do best, every day. Since we were founded, we have relied on innovative and creative thinking to understand tomorrow's needs in the marketplace. Becoming part of Instem allows us to deliver more value, more quickly and to more users everywhere. The entire team here at Notocord® is excited to be supported by a full complement of resources across Instem's eleven international offices. Instem shares in our commitment to excellence and is also well known for highly satisfied clients throughout all of the segments that they serve."


Phil Reason, CEO of Instem plc, commented: "Notocord® has a stellar reputation and a high quality team.  Having known Philippe and their solutions for many years, we are confident that we will be successful together and that our clients will be very encouraged by the combination of two complementary offerings. As experts in safety pharmacology, the Notocord® team joins us just as this becomes a significant additional focus area for SEND, one of our largest growth opportunities over the next few years.  There are also some disruptive innovations in the safety pharmacology market at the moment which are potentially highly beneficial for Instem, so the timing is just right to bring Notocord® into the group.  We are in a strong position to increase the global reach and penetration of the existing Notocord® products while helping the team to launch new and exciting solutions."


This announcement contains inside information for the purposes of Article 7 of EU Regulation 596/2014.


For further information, please contact:

Instem plc

+44 (0) 1785 825 600

Phil Reason, CEO

Nigel Goldsmith, CFO


N+1 Singer (Nominated Adviser & Broker)

+44 (0) 20 7496 3000

Richard Lindley

Nick Owen

James White


Walbrook Financial PR


+44 (0) 20 7933 8780

Paul Cornelius

[email protected]

Helen Cresswell

Sam Allen

Paul Whittington



About Instem


Instem is a leading supplier of IT applications and services to the early development healthcare market delivering compelling solutions for data collection, analysis and regulatory submissions management. Instem solutions are in use by customers worldwide, meeting the rapidly expanding needs of life science and healthcare organisations for data-driven decision making leading to safer, more effective products.


Instem's portfolio of software solutions increases client productivity by automating study-related processes while offering the unique ability to generate new knowledge through the extraction and harmonisation of actionable scientific information.


Instem supports over 500 clients through offices in the United States, United Kingdom, France, Japan, China and India.


To learn more about Instem solutions and its mission, please visit


More About Notocord  


NOTOCORD® develops software solutions that help power the processes within the preclinical phase of drug development. Trusted by leading commercial research organisations, universities and government institutes, the NOTOCORD® solution suite includes:


NOTOCORD-hem® - an advanced software platform designed to acquire, display and analyse physiological signals. Covering Cardiovascular, Respiratory and Nervous system research areas, NOTOCORD-hem™ offers:

•              Over 160 modules for a customised analysis

•              In vivo, In vitro and Ex vivo

•              Implants and non-invasive telemetry

•              Simultaneous acquisition from different sources and systems

•              Flexible user interfaces offering easy configuration and displays

•              Ultra-fast access to data regardless of experiment file size

•              Compliance with regulatory standards


NOTOCORD-fps® - a solution based on a new Field Potential Analysis (FPS) method for analysis supporting an upcoming change in an industry standard for novel safety screening using stem cell data. The Comprehensive in vitro Proarrhythmia Assay, or CiPA, is being considered by regulators and industry work groups and is expected to act as a prerequisite for all non-cardiac drug marketing approvals. The CiPA initiative is intended to move safety pharmacology from a predominantly traditional pharmacodynamics approach to in silico and in vitro drug toxicity assessment.


NOTOCORD-sense® - the next generation platform encompassing new features for its hem and fps solutions along with new exciting capabilities.


To find out more information about NOTOCORD® solutions, please visit




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