CareDx Inc. (NASDAQ:CDNA) has agreed to sell its Lab Products business to EuroBio Scientific for $170 million in cash, marking a strategic shift toward its higher-growth precision testing and digital solutions segments.
The transaction, approved by both companies' boards, is expected to close by the end of the third quarter of 2026.
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Strategic Shift Toward Core Testing Services
John Hanna, president and CEO of CareDx, said the divestiture aligns with the company's focus on its core Testing Services and Patient and Digital Solutions businesses, which posted strong year-over-year growth in the first quarter.
Testing Services revenue rose 48%, while Patient and Digital Solutions grew 33%, reflecting what Hanna described as a successful "solutions-selling strategy."
The Lab Products unit, which includes PCR and next-generation sequencing-based diagnostic kits used globally, operates under a different model compared to CareDx's primarily U.S.-focused services business. The sale is intended to simplify operations and improve capital allocation efficiency.
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Deal Terms and Commercial Agreements
Under the agreement, CareDx will receive $170 million in cash at closing and provide transition services for at least six months.
EuroBio Scientific will grant CareDx exclusive, perpetual rights to distribute certain post-transplant monitoring IVD tests in North America, including AlloSeq cfDNA, the kit-based version of its AlloSure test.
Capital Allocation and Growth Priorities
CareDx said proceeds from the transaction will support long-term growth initiatives, including potential acquisitions aligned with its Precision Diagnostics Solutions model. The company also indicated that shareholder returns could be considered.
Preliminary Results Show Strong Growth
CareDx reported preliminary first-quarter 2026 revenue of approximately $118 million, up 39% year-over-year.
Testing Services generated about $91 million in revenue, while Patient and Digital Solutions contributed $16 million. Lab Products revenue declined 4% to around $10 million.
Testing volume reached roughly 54,900, up 17%, with average revenue per test at approximately $1,660.
The company ended the quarter with about $198 million in cash and marketable securities and plans to provide full guidance during its earnings call on April 28.
CDNA Stock Price Activity: CareDx shares were up 28.54% at $22.59 at the time of publication on Thursday, according to Benzinga Pro data.
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