Features | Partner Sites | Information | LinkXpress
Sign In
AB Sciex
Bio-Rad Diabetes Division

MDx and M&A Markets Experience Lull in Late 2011

By Labmedica International staff writers
Posted on 10 Jan 2012
The number of mergers and acquisitions (M&A) in the genomics tools and molecular diagnostics (MDx) markets declined in the second half of 2011.

In the first six months of the year, 38 acquisitions were completed or announced, up from 33 during the comparable period in 2010. The second half of 2011, however, saw a significant downturn in M&A activity as 20 deals were completed or announced, down from 25 in the comparable year-ago period.

Throughout much of the year, there was uncertainty surrounding government funding—and while the picture coming out of Europe has played out better than feared, the United States funding landscape continues to concern many, even with the recent passage of a 1 percent increase in National Institutes of Health (NIH; Bethesda, MD, USA) funding for fiscal year 2012.

A Congressional Super Committee failed to reach a budget-cutting deal last month, which could lead to significant cuts in scientific research funding in fiscal year 2013. This failure is cause for concern and it has made everyone more cautious, especially those in smaller firms.

Not only did the number of deals dwindle as the year progressed, the size of the deals also became more modest. No acquisition in the second half of the year approached the USD 6.8 billion that Danaher (Washington DC, USA) agreed to pay in February to acquire Beckman Coulter (Brea, CA, USA).

Acquisitions during the second half of 2011 mostly consisted of small to mid-sized firms combining their businesses. The most high-profile transaction in the last six months of the year was probably PerkinElmer's (Waltham, MA, USA) USD 600 million purchase of Caliper Life Sciences (Hopkinton, MA, USA). Overall, PerkinElmer was the most acquisitive company in the life science tools space with seven purchases in total during the year, including four companies offering bioinformatics-related products.

Other active buyers in 2011 were Thermo Fisher Scientific (Waltham, MA, USA), which made five purchases, and Agilent Technologies, which acquired four firms, including most recently Halo Genomics (Uppsala, Sweden) and BioSystem Development (Madison, WI, USA).

In the life science tools and 'omics space, M&A activity may be even livelier in the coming years. Generally, there are more growth opportunities in the space than in the general IVD market, in part because the technologies that have been in development are now finally mature enough to be commercialized.

Pharmaceutical firms are becoming increasingly interested in the use of 'omics technologies to develop companion diagnostics for drugs in their pipelines. As an example, Swiss pharma giant Novartis created a molecular diagnostics unit three years ago to focus specifically on developing diagnostics for determining which patients may benefit from certain drugs.

Peter Lawson, an analyst at investment firm Mizuho Securities (Japan), commented that as a whole, 2011 shaped out to be better year on the M&A front than 2010 in the broader life science space. Although the number of deals may have stayed level year over year, the number of "impactful" acquisitions in 2011 will total about USD 20 billion this year compared to USD 3 billion a year ago.

Investment bank Goldman Sachs (London, United Kingdom) also anticipates a healthy rate of acquisitions in the near-term. In a report this month, analysts Isaac Ro and David Roman said that companies in the life science tools and diagnostics space have employed cash "more offensively in the form of M&A," as opposed to share repurchases in recent years.

Related Links:
National Institutes of Health
Beckman Coulter

DiagCor Bioscience
comments powered by Disqus
Life Technologies


Clinical Chemistry

view channel
Image:  The Agilent 6890 GC with 5973 Mass Spectrometer and Tekmar Velocity XPT Purge & Trap (Photo courtesy of Gen Tech).

Low Levels of Prohormone Predicts Coronary Heart Disease

The adrenal sex hormone dehydroepiandrosterone (DHEA), which is present in serum mainly as the sulfate DHEA-S, is the most abundant steroid hormone in human blood and its levels decline dramatically with age.... Read more

Genetic Tests

view channel
Histopathology of colonic adenocarcinoma; the glands are enlarged and filled with necrotic debris (Photo courtesy of the University of Utah).

Promising Blood Biomarkers Isolated for Colorectal Cancer

The search for blood-borne biomarkers that could be used to screen for colorectal cancer (CRC) has uncovered two promising candidates that may one day lead to the development of a simple blood test.... Read more


view channel
Image: The causative parasite of Chagas disease Trypanosoma cruzi in a blood film (Photo courtesy of the CDC - US Centers for Disease Control and Prevention).

Undiagnosed Chagas Disease Emerging as Public Health Threat

Chagas disease or American trypanosomiasis is typically spread to people through the feces of blood-sucking triatomine bugs sometimes called kissing bugs because they feed on people's faces during the night.... Read more
Copyright © 2000-2014 Globetech Media. All rights reserved.