M&A Report

Biden Orders Feds to Target Health Care Consolidation but Deals Continue

This month’s big stories in M&A deal making come not just from the market but the regulatory front.

New Biden Executive Order Targets Health Care Consolidation

Consolidation in the health care market has been a major concern, particularly in the past two years when hospitals, health networks and corporate equity funds began swallowing up independent physicians’ practices at accelerated rates. Against this backdrop, as well as a new report from the Physicians Advocacy Institute (PAI) finding that only 30 percent of all physicians in the U.S. are practicing medicine independently, President Biden issued a new Executive Order (EO) on July 9 calling on the Department of Justice (DOJ), Federal Trade Commission (FTC) and other federal government agencies to vigorously enforce the antitrust laws across all markets, including health care.

The EO identifies four segments of health care as priority areas for enforcement:

  • Hospital consolidation;
  • Prescription drugs;
  • Health insurance consolidation; and
  • Hearing aids.

The EO stresses that hospital mergers can be harmful to patients, especially in rural areas left underserved by consolidation. Thanks to “unchecked mergers,” the 10 largest healthcare systems now control a quarter of the market, the EO notes, adding that138 rural hospitals have shuttered since 2010, including a high of 19 last year, in the middle of a healthcare crisis. Research shows that hospitals in consolidated markets charge far higher prices than hospitals in markets with several competitors. The EO thus recommends that the DOJ and FTC review and revise their merger guidelines and directs HHS to support existing hospital price transparency rules and finish implementing bipartisan federal legislation to address surprise hospital billing.

Mologic Becomes a Social Enterprise and PerkinElmer Makes a Big Play

Meanwhile, M&A deals did come down during July, including a pair of blockbusters. The first, which was announced on July 19, represents a kind of counterpoint to the consolidation-is-bad message of the new Biden EO issued just nine days earlier. Instead of greedy insurance executives and Wall Street corporate raiders, financing for the acquisition of rapid diagnostic test maker Mologic and its sister firm Global Access Diagnostics (GAD) by the Soros Economic Development Fund is coming from the Bill & Melinda Gates Foundation. Mologic and GAD will become part of Global Access Health, a social enterprise dedicated to expanding access to affordable medical technology in underserved low- and middle-income countries around the world.

Teeming with COVID-19 testing cash, PerkinElmer announced that it has agreed to plunk down $5.25 billion in cash and stock to acquire antibodies and reagents provider BioLegend, a firm with over 700 employees and expected 2022 revenues of $380 million. The acquisition, the largest in company history, positions PerkinElmer to enter new segments of the life sciences research market. San Diego-based BioLegend will become PerkinElmer’s global center of excellence for research reagent content development. The combined company will become a “true powerhouse that will have the skill to be able to accelerate scientific advancement and new product innovation across the company and around the world,” according to the statement of PerkinElmer CEO Prahlad Singh.

Here’s a summary of the key new M&A diagnostic deals announced in July 2021:


Acquiring Company Target(s) Deal Summary
PerkinElmer BioLegend
  • Price: $5.25 billion in cash and stock
  • Status: Expected to close in 2021
  • PerkinElmer moves into new segments of life science via acquisition of producer of antibodies and reagents for cytometry, proteogenomics, multiplex assays, recombinant proteins, magnetic cell separation and bioprocessing with expected $380 million in 2022 revenues
  • PerkinElmer said. The deal will expand PerkinElmer’s presence into new life sciences segments
Pacific Biosciences Omniome
  • Price: Up to $800 million, including 9.4 million shares of Pac Bio’s common stock + $300 million cash + $200 million in contingent, milestones-based cash and stock
  • Status: Expected to close by end of Q2
  • Merger enables Pac Bio to combine its long-read portfolio with Omniome’s short-read sequencing technology
PathAI Poplar Healthcare
  • Price: Undisclosed
  • Status: Closed
  • Acquisition of provider of specialized lab testing services for gastrointestinal pathology, dermatology, oncology, urology and women’s health
Becton Dickinson Velano Vascular
  • Price: Undisclosed
  • Status: Closed
  • BD acquires developer of technology enabling blood draws from peripheral intravenous catheter lines
Meridian Bioscience Otsuka America Pharmaceutical
  • Price: $20 million cash
  • Status: Expected to close in Q4
  • Meridian acquires Otsuka’s BreathTek, a urea breath test for detection of Helicobacter pylori
Sapphiros Biocrucible
  • Price: Undisclosed
  • Status: No closing date announced
  • Newly formed company formed by investment firm KKR acquires UK startup developer of point-of-care molecular diagnostics
XPhyto Therapeutics 3a-diagnostics
  • Price: €3.9 million ($4.6 million), including €400,000 up front and €3.5 million on closing
  • Status: Expected to close at end of October
  • Acquiring all outstanding shares of 3a, its exclusive diagnostics development partner, enables XPhyto to expand into point-of-care biosensor diagnostics
BioIVT Tissue Solutions
  • Price: Undisclosed
  • Status: Closed
  • Acquisition of UK-based virtual biobank
Kiromic BioPharma. InSilico Solutions
  • Price: Swap stock deal at undisclosed price
  • Status: Closed
  • Acquisition of developer of custom bioinformatics applications to help researchers extract meaning from genomic datasets boosts Kiromic’s bioinformatics capacity
Soros Economic Development Fund with support of Bill & Melinda Gates Foundation Mologic +Global Access Diagnostics
  • Price: Undisclosed
  • Status: Closed
  • Both companies to be integrated under Global Access Health (GAH), a social enterprise dedicated to expanding access to affordable medical technology in low- and middle-income countries
  • GAH to invest at least $41 million in deal
Genetic Technologies EasyDNA
  • Price: $2 million cash up front + $1.5 million in Genetic Technologies American Depository Receipts + $500,000 in cash on first anniversary of closing
  • Status: Expected to close July 31
  • Genetic Technologies to acquire all websites, brand identities, lab testing and distribution agreements associated with General Genetics Corporation, which trades as EasyDNA
Inotiv MilliporeSigma
  • Price: Undisclosed
  • Status: Closed
  • MilliporeSigma sells off genetic toxicology assets of its BioReliance portfolio after deciding to discontinue its genetic toxicology operations
Nephros GenArraytion
  • Price: Undisclosed
  • Status: Closed
  • Nephros acquires substantially all assets of infectious disease monitoring firm which will be integrated into its Nephros Pathogen Detection Systems platform
ACT Genomics MC Diagnostics
  • Price: Undisclosed
  • Status: Closed
  • Taiwanese molecular diagnostic firm to develop fusion gene chips on ALDAS, MC Diagnostics’ automated low density array platform
Ro Kit
  • Price: Undisclosed
  • Status: Closed
  • Telehealth firm acquires at-home diagnostic testing company
Q² Solutions Myriad Genetics
  • Price: Undisclosed
  • Status: Closed
  • Myriad continues restructuring by selling off Myriad RBM unit which provides contract research services for pharmaceutical industry after selling Vectra to LabCorp
Sebia Orgentec Diagnostika
  • Price: Undisclosed
  • Status: Expected to close in Q3
  • Acquisition of German diagnostics firm expands Sebia’s capabilities in autoimmunity, infectious diseases and clinical trials
Twist Bioscience iGenomX
  • Price: $35 million
  • Status: Closed
  • Acquisition of developer of multiplex library preparation tools for next-generation sequencing workflows boosts Twist’s capacity to support multiplex sequencing preparations across multiple markets
DCN Dx IVD Vision
  • Price: Undisclosed
  • Status: Closed
  • Acquisition of developer of custom diagnostic instruments and software comes on heels of DCN Dx’s acquisition of PortaScience, a point-of-care diagnostics company focused on dry chemistry technology
GenesisCare PreludeDx
  • Price: Undisclosed
  • Status: Closed
  • GenesisCare acquires minority stake in PreludeDx as part of partnership to offer latter’s DCISionRT precision medicine breast cancer test in Australia

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