Blackford Analysis, an AI-driven medical imaging firm spun out of Edinburgh University, has been acquired by Bayer, the global life science company.

Spun out in 2010 and still headquartered in the city, Blackford has a presence in the UK and US and will continue to operate on an arm’s-length basis in Edinburgh. No changes are expected to the management and staff.

The acquisition is expected to close later this year, pending the satisfaction of customary closing conditions. Terms were not disclosed.

Blackford has a number of strategic partnerships with blue-chip companies as well as innovative medical imaging AI providers to develop and commercialise technology and sells to international markets. The team’s expertise and success to date were important factors in Bayer’s acquisition, bolstering its position in the space.

In 2020, Blackford and Bayer collaborated through a development and licence agreement that laid the foundation for Bayer’s recently launched medical imaging platform, Calantic Digital Solutions.

The overall global medical imaging AI sector is expected to continue growing dynamically, reaching $1.36 billion by 2026.

Innovation powered by AI is needed more than ever to help combat the increased demand for medical imaging to detect diseases and to guide optimised patient treatment pathways. 

Blackford founder and CEO, Ben Panter, said: “Blackford exists to improve the lives of patients and populations by unlocking the adoption and benefits of medical imaging AI and we explored a number of funding options to expand the company to deliver this mission.

“Bayer’s offer allows us freedom to continue to deliver that mission as an independent, arms-length company along with all the strength and support of an experienced life science partner. 

“I’d like to acknowledge our investors’ unwavering support over the last twelve years, and I’m delighted to be returning value that can be reinvested in the next generation of entrepreneurial companies in Scotland.”

Blackford has been supported by strategic investors in Scottish health-tech companies, including the world’s longest continually operating angel syndicate, Archangels, as well as the University of Edinburgh’s venture investment fund, Old College Capital, Scottish Enterprise, Thairm Bio, and Tricapital. Archangels has provided £6m of patient capital investment to support Blackford’s growth since 2012. 

Niki McKenzie, joint managing director of Archangels, said: “The acquisition of Blackford is excellent news for Ben and his brilliant team who we’ve worked with for over a decade. Blackford’s acquisition by a company of Bayer’s global stature represents a major success story for Archangels, demonstrates the opportunity for the Scottish tech community and the esteem in which is held internationally.”

Stefan Oelrich, member of Bayer’s board of management and president of Bayer’s pharmaceutical division, said: “Adding Blackford and its AI technology to our radiology portfolio secures Bayer an excellent position in the fastest growing segment within the overall global radiology industry.”

Catherine Martin, vice-principal of corporate services at the University of Edinburgh, said: “The University is proud to have supported Dr Ben Panter and Blackford Analysis from the time of the company’s spin out from our Institute of Astronomy in 2010.

“By applying technology originally developed for stargazing to the medical sphere, Blackford is a fantastic example of how University research can be translated into real-world solutions. This acquisition is testament to the brilliant Blackford team and supportive investor group led by Archangels.”

Alantra served as Blackford’s exclusive financial adviser in the transaction.