Paradigm Genetics has struck a deal to acquire TissueInformatics, a Pennsylvania based firm, in an all-stock deal worth more than $4 million.

The deal gives Paradigm what it called a “unique systems biology platform” to be used in drug discovery. The combined entity hopes to “create a unique systems biology platform that enables the quantitative analysis of disease and drug action using a Gene to Cell to System approach.”

Privately held TissueInformatics is based in Pittsburgh. It develops and applies automated software for use in analysis of tissue changes that occur during drug discovery, disease assessment, toxicology and tissue engineering.

Paradigm (Nasdaq: PDGM) will issue 3.4 million shares for the acquisition. Paradigm stock closed at $1.29 on Thursday. The company said another 2.7 million shares are “subject to performance milestones.”

TissueInformatics has already in place a joint venture with DiAthegen to explore drug targets and diagnostics in diabetes, obesity and aging.

“The acquisition of TissueInformatics will accelerate the commercialization of our technologies and the building of our own product portfolio in biomarker-enabled drug discovery,” said Heinrich Gugger, president and chief executive officer of Paradigm, in a statement. “I am also enthusiastic about the opportunities to apply TissueInformatics expertise in quantitative tissue analysis to our agricultural research programs. Most importantly, we believe this acquisition provides Paradigm Genetics with a unique competitive advantage as the first company to combine gene expression profiling, biochemical profiling and quantitative tissue analysis in a systems biology approach to life sciences discovery.”

TissueInformatics will remain based in Pittsburgh, and its management team will remain with the combined company, Paradigm said. Peter Johnson will become Executive Vice President and Chief Medical Officer, and Mark Braughler, Ph.D., will become Vice President, Business Development for Healthcare.

Paradigm Genetics: