Water Street Invests in Pathnostics
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Water Street Invests in Pathnostics

Water Street Healthcare Partners has closed on its investment in Pathnostics, a provider of diagnostic tests and services across a range of therapeutic areas.

Pathnostics’ tests are used in the urology, women’s health, gastroenterology and cancer sectors. The company has experienced rapid growth in recent years due to the increased use of its Guidance UTI test by urologists which is able to simultaneously diagnoses and guide antibiotic treatment for recurring urinary tract infections. This test uses proprietary and patented technology. Pathnostics was founded in 2014 and is headquartered in Irvine, CA (www.pathnostics.com).

Dave Pauluzzi, the co-founder of Pathnostics, will continue to lead the company as CEO. Mr. Pauluzzi previously worked with Water Street when he was president and CEO of PLUS Diagnostics, a provider of anatomic pathology services. Anatomic pathology is the diagnosis of disease based on the macroscopic, microscopic, biochemical, immunologic and molecular examination of organs and tissues. Water Street acquired PLUS Diagnostics in 2006 and sold the company to Miraca Life Sciences in 2013.

“I’m thrilled to be working again with the Water Street team,” said Mr. Pauluzzi.  “Their industry expertise and network of resources will give us the ‘lift’ we need to take Pathnostics to the next level to benefit our customers and achieve our long-term vision of building Pathnostics into a diagnostic solutions leader.”

Water Street has years of experience in the diagnostic and laboratory services sector and will be active in expanding Pathnostics’ technology and portfolio of products.

“Pathnostics’ one-of-a-kind technology is a breakthrough. Its proven ability to swiftly deliver highly accurate therapeutic guidance enables physicians to immediately treat complex and chronic infections,” said Scott Garrett, a senior operating partner with Water Street and former chairman and CEO of Beckman Coulter, a provider of biomedical laboratory instruments. “We have a significant opportunity to leverage this unique technology across medical specialties to substantially improve patient care and reduce the cost of problematic infections.  We’re excited to be Pathnostics’ partner as they develop new tests and expand their product portfolio into new therapeutic areas, and continue their impressive growth.”

Water Street invests from $50 million to $500 million in companies that are active in four healthcare sectors: medical and diagnostic products; specialty distribution; health care services; and specialty pharmaceutical products and services.  The firm has particular expertise in corporate divestitures from healthcare companies. Water Street was founded in 2005 and is based in Chicago (www.waterstreet.com).

Pathnostics marks Water Street’s fifth investment in the diagnostics sector and its first investment of 2019.

© 2019 Private Equity Professional | March 1, 2019

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