DIAGNOSTIC DEALS

Diagnostic Deals: A Roundup of the Key Mergers, Acquisitions, Alliances, Licenses and Other Strategic Transactions From the Past Month

Spring has sprung with the announcement of a king-size deal: Danaher’s $21.4 billion cash acquisition of GE Life Sciences, known as GE Biopharma, from General Electric Company (GE). Here’s a quick overview of the transaction and the rest of the past month’s activity (from late February to late March).

M&A
Danaher’s binding agreement to acquire GE Biopharma is the biggest M&A deal in the diagnostics space in over a year. The acquired business will operate as a standalone company within Danaher’s $6.5 billion Life Sciences segment. Other companies in the unit include Pall, Beckman Coulter Life Sciences, SCIEX, Leica Microsystems, Molecular Devices, and Phenomenex, along with IDT businesses. According to Danaher CEO Thomas P. Joyce, Jr., “GE Biopharma is renowned for providing best-in-class bioprocessing technologies and solutions. This acquisition will bring a talented and passionate team as well as a highly innovative, industry-leading product suite to our Life Sciences portfolio, providing an excellent complement to our current biologics workflow solutions.”

Unloading GE Biopharma is part of a larger, ongoing restructuring plan by GE that has it exiting several sectors in order to focus on three core segments: aviation, power, and renewable energy. Assuming regulatory approval, the transaction is expected to close in the fourth quarter.

Other noteworthy M&A deals during the period include cancer fighting firm Oncimmune’s acquisition of Protagen Diagnostics, a leader in personalized immune-profiling, for up to $5.5 million and Grifols’ acquisition of a 26.2% stake in Shanghai RAAS as part of a strategic alliance to manufacture, market, and develop plasma products and transfusion diagnostic solutions in the Chinese market.

Strategic Alliances
Among new alliances are several involving companies based in China. Natera, a genetic-testing company in San Carlos, Calif., has entered into a 10-year partnership agreement with China’s BGI Group, known as BGI Genomics, which operates a genomic sequencing center. The agreement will commercialize Natera’s circulating tumor DNA Signatera minimal residual disease (MRD) test in China. Details about this and other agreements are provided in the chart below.

In addition to these alliances is one of note not included in the chart, because it is about the end of an agreement. Epigenomics, a molecular diagnostic company headquartered in Germany, has terminated its collaboration with China’s BioChain for the licensing of the Septin9 marker and exclusive Chinese distribution rights for Epi proColon, Epigenomics’ blood test for colorectal cancer. The companies entered into the licensing deal in March 2016. Epigenomics is exercising its right to terminate the agreement, based on the fact that BioChain has not paid more than the agreed minimum royalties over a three-year period.

Here’s a summary of key diagnostic deals from late February through late March:

MERGERS, ACQUISITIONS & ASSET SALES
Acquiring Company Target(s) Deal Summary
Danaher General Electric’s Biopharma business
  • Price: $21.4 billion cash
  • Status: Definitive agreement expected to close Q4 2019
  • Danaher financing the deal with $3 billion from equity offering, cash on hand + proceeds of debt and/or new credit facilities issuance
  • GE business to operate as a standalone company within Danaher’s $6.5 billion Life Sciences segment
Oncimmune Protagen Diagnostics
  • Price: Up to $5.5 million—62% in Oncimmune common shares (at $2.07 per) + balance contingent on milestones
  • Status: Closed
  • Qiagen, currently an investor in Protagen to become an investor in Oncimmune and get up to 862,179 shares to settle a convertible loan and accrued interest of $3.0 million made to Protagen
Constellation Alpha Capital DermTech
  • Price: $15 million cash + enough Constellation common shares to make DermTech majority owner of combined company’s shares
  • Status: Expected to close in Q2
  • DermTech, which provides skin and skin cancer diagnostics, to become wholly-owned sub of Constellation
Bruker Arxspan
  • Price: Undisclosed
  • Status: Closed
  • Acquiring cloud software provider enables Bruker to boost its own software products
Summa Equity Olink Proteomics
  • Price: Undisclosed
  • Status: Closed
  • Acquisition of Swedish life sciences firm known for its proximity extension assay (PEA) technology
Grifols Shanghai RAAS
  • Price: $1.9 million value in form of 45% of economic rights + 40% of voting rights in Grifols US sub, Grifols Diagnostic Solutions
  • Status: Expected to close 2H 2019
  • Grifols acquires 26.2% stake in Shanghai RAAS as part of strategic alliance agreement to manufacture market, and develop plasma products and transfusion diagnostic solutions for China market
Precision for Medicine SimplicityBio
  • Price: Undisclosed
  • Status: Closed
  • Acquisition of AI tech firm enables Precision for Medicine to add AI to its QuartzBio bioinformatics and multiomics data integration platform for biomarker-guided drug development
STRATEGIC ALLIANCES, PARTNERSHIPS & COLLABORATIONS
Partner 1 Partner 2 Deal Summary
BioMérieux Baxter International
  • Objective: Develop biomarkers for acute kidney injury detection
  • Dynamic: BioMérieux to utilize expertise from its newly acquired Astute Medical business, including Nephrocheck assay for guiding sepsis treatment
Qiagen Tecan Group
  • Objective: Improve processing of Qiagen’s QuantiFeron-TB Gold Plus (QFT-Plus) diagnostic test
  • Dynamic: Non-exclusive partnership to standardize and automate manual steps in liquid handling for aliquoting of QFT-Plus samples using Tecan’s Fluent lab automation workstation and Lithium Heparin single-tube workflow
  • Tecan’s life sciences business to directly supply Fluent systems to labs that want to implement the workflow
Genomics England Cambridge Cancer Genomics (CCG.ai)
  • Objective: Improve patient access to monitor treatment effectiveness of immunotherapies
  • Dynamic: Partnership in which AI startup CCG.ai will join Discovery Forum, a Genomics England-led collaboration platform for genomics researchers in UK
  • CCG.ai also to contribute its liquid biopsy technology and a sequencing panel for measuring tumor mutational burden to assess treatment resistance to immunotherapy drugs
Microba Macrogen
  • Objective: Develop microbiome research services for international markets
  • Dynamic: Initial collaboration on shotgun metagenomic sequencing-based service for South Korea and other nations outside Australia
  • Parties also plan to build library of high-resolution gut microbiome data for use in developing microbiome-based diagnostics and therapeutics
My Gene Counsel Ambry Genetics
  • Objective: Offer medical-grade testing to verify direct-to-consumer (DTC) genetic test results
  • Dynamic: Alliance to also provide DTC genetic counseling to individuals found to be at high risk for cancer
BeaconLBS MagnaCare
  • Objective: Offer BeaconLBS’ point-of-care physician decision support platform to MagnaCare’s physician and lab providers network
  • Dynamic: BeaconLBS platform leverages EHR and lab ordering systems to provide physicians access to evidence-based guidelines and pricing information to guide choice of test and testing lab
Advanced Biological Laboratories Mayo Clinic Laboratories
  • Objective: Develop NGS test to detect mutations associated with antiviral resistance in human cytomegalovirus
  • Dynamic: Test to sequence PCR amplicons of UL54 and UL97 genes in which drug resistance with CMV has been associated
  • Use ABL’s DeepChek-CMV software to analyze the data and interpret possible drug resistance in virus
  • Mayo Clinic gets financial interest in new technology with revenues going to support non-profit interests
Sona Nanotech Olm Diagnostics
  • Objective: Develop point-of-care diagnostic tests for infectious diseases
  • Dynamic: Sona manufactures gold nanorods producing different colors when integrated into a test strip, making them ideal for multiplexing
  • Olm Diagnostics wants to develop rapid, multiplexed lateral flow assays to detect infectious diseases in humans to help doctors perform primary diagnoses
Biocartis Bristol-Myers Squibb
  • Objective: Develop a companion diagnostic for Bristol-Myers Squibb cancer immunotherapies initially focusing on colorectal cancer (CRC)
  • Dynamic: Jointly develop, register and get FDA approval for Biocartis’ Idylla MSI test, which provides information on microsatellite instability status of a CRC tumor from a single slice of FFPE tumor tissue without need for a reference sample
Lucence Diagnostics Stanford University School of Medicine
  • Objective: Develop AI algorithms to improve diagnosis and treatment of liver cancer by analyzing both imaging and molecular data
  • Dynamic: Lucence to process dataset of 5,000+ liver cancer patients to identify changes and patterns in imaging and mutations that could predict effectiveness of a therapy
  • Use data from Lucence’s LiquidHallMark blood test analyzing DNA of cancer-related mutations and viral targets
Natera BGI Genomics
  • Objective: Commercialize Natera’s circulating tumor DNA Signatera minimal residual disease (MRD) test in China
  • Dynamic: 10-year partnership under which BGI Genomics will pay Natera $50 million, including upfront licensing fees, prepaid royalties and future milestone payments—plus ongoing royalties
  • Natera will prepay BGI Genomics $6 million for sequencing services
  • Natera and BGI Genomics to initially offer Signatera test through specialty hospital networks in China and then across the entire country after gaining regulatory approval for test on BGI’s DNBseq sequencing technology platform
  • Sides also plan to develop reproductive health tests run on DNBseq in other “select markets”
Ortho Clinical Diagnostics Beijing Leadman Biochemistry
  • Objective: Launch 4 assays for China market
  • Dynamic: Tests (cystatin C for early diagnosis of chronic kidney disease; α-hydroxybutyrate dehydrogenase for diagnosing heart attack; homocysteine for assessing risk factors for coronary atherosclerosis, Alzheimer’s disease, venous embolism, neonatal defects and habitual abortion; and total bile acids for early detection of liver injury) approved for use in China on Ortho’s Vitros 4600 chemistry system and Vitros 5600 integrated system
  • Leadman to offer tests as reagents in prefilled packages for use specifically with the Vitros systems
Illumina Boai NKY Medical Holdings
  • Objective: Develop NGS-based hereditary disease tests in China
  • Dynamic: Create an NGS system based on Illumina’s MiniSeq system and NKY’s library prep kits and analysis software and get regulatory approval for use in China
Atgenomix Yourgene Bioscience Taiwan
  • Objective: Create unified system for advanced whole-genome sequencing and whole-exome sequencing variant analysis
  • Dynamic: Combine Atgenomix’s high-speed data analytics platform with Yourgene’s hereditary and cancer mutation analysis workflows
Admera Health MedCDx
  • Objective: Co-develop companion diagnostics
  • Dynamic: Non-exclusive collaboration agreement giving each side access to the other’s existing portfolios for the purpose of CDX co-development
Bio-Techne Lisen Imprinting Diagnostics Wuxi
  • Objective: Accelerate development of molecular diagnostics in Chinese market
  • Dynamic: Strategic partnership with no financial or other terms announced
Centogene Sarepta Therapeutics
  • Objective: Identify patients with Duchenne muscular dystrophy (DMD) in Middle East and North Africa
  • Dynamic: 12-month strategic collaboration under which Centogene will conduct molecular testing using deletion/duplication analysis and full-length sequencing of DMD gene diagnostic services to help physicians treating patients with DMD symptoms
Biocept Providence St. Joseph Health, Southern California + Saint John’s Health Center + John Wayne Cancer Institute
  • Objective: Evaluate usage of cerebral spinal fluid (CSF) in liquid biopsy testing for metastatic cancer
  • Dynamic: Biocept to use its Target Selector liquid biopsy platform to test CSF samples from patients diagnosed breast, lung and other cancers and melanoma to determine if leptomeningeal metastases (LM) has occurred
  • Researchers to then compare results to standard testing methods to confirm diagnosis
Boehringer Ingelheim GNA Biosolutions
  • Objective: Develop emergency veterinary diagnostics
  • Dynamic: Research collaboration to create rapid diagnostic test for African swine fever to be used on GNA portable molecular diagnostic platform
Invitae BioMarin + Stoke Therapeutics + Xenon Pharmaceuticals
  • Objective: Expand Invitae’s free genetic testing program for children with epilepsy
  • Dynamic: Behind the Seizure testing to be offered to kids 0 to 5-years-old
Oova (Mount Sinai Health System spinout) Thorne Research
  • Objective: Make Oova’s fertility monitoring tool available to over 3 million consumers and 35,000 clinicians
  • Dynamic: Partnership under which Oova’s at-home test will be sold bundled with Thorne supplements
Illumina + Baylor Genetics + Broad Institute + HudsonAlpha Institute for Biotechnology Mayo Clinic + Rady Children’s Institute for Genomic Medicine + Hospital for Sick Children + Stanford Medicine
  • Objective: Expand access to clinical whole-genome sequencing (WGS) for diagnosis of genetic diseases
  • Dynamic: Launch new consortium called Medical Genome Initiative to focus on publishing lab and clinical best practices for applying WGS required for clinical WGS to be implemented at scale
DISTRIBUTION, SALES & MARKETING AGREEMENTS
Property Owner Distributor Deal Summary
 Sienna Cancer Diagnostics Inside Diagnósticos
  • Products: Sienna’s telomerase reverse transcriptase (hTERT) test
  • Territory: Brazil
  • Exclusive
EliTechGroup Hardy Diagnostics
  • Products: EliTechGroup’s Mycofast US
  • Territory: Undisclosed
  • Hardy Diagnostics made authorized distributor
SpeeDx Al Zahrawi Medical Supplies
  • Products: SpeeDx Resistance Plus and PlexPCR products
  • Territory: Kuwait, Bahrain, Qatar, Yemen, Oman, UAE, Saudi Arabia, Bahrain, Qatar, Oman
Luxia Scientific Life Genomics
  • Products: Luxia’s microbiome test
  • Territory: Norway, Denmark, Iceland, Finland
  • Exclusive distribution agreement
AusDiagnostics Custom Science
  • Products: AusDiagnostics’ PlexWell technology and products for multiplexed NGS applications
  • Territory: Australia
  • Exclusive
AusDiagnostics Beijing Pukairui Biotech
  • Products: AusDiagnostics’ PlexWell technology and products for multiplexed NGS applications
  • Territory: China
  • Exclusive
AusDiagnostics Thunder Bioscience
  • Products: AusDiagnostics’ PlexWell technology and products for multiplexed NGS applications
  • Territory: Korea
  • Exclusive
AusDiagnostics Custom Science Auckland
  • Products: AusDiagnostics’ PlexWell technology and products for multiplexed NGS applications
  • Territory: New Zealand
  • Exclusive
AusDiagnostics Sciencewerke
  • Products: AusDiagnostics’ PlexWell technology and products for multiplexed NGS applications
  • Territory: Singapore, Malyasia, Indonesia
  • Exclusive
AusDiagnostics Sopachem
  • Products: AusDiagnostics’ PlexWell technology and products for multiplexed NGS applications
  • Territory: Belgium, Netherlands, Denmark
  • Exclusive
AusDiagnostics Zotal
  • Products: AusDiagnostics’ PlexWell technology and products for multiplexed NGS applications
  • Territory: Israel
  • Exclusive
AusDiagnostics Labtech International
  • Products: AusDiagnostics’ PlexWell technology and products for multiplexed NGS applications
  • Territory: UK, Ireland
  • Exclusive
AusDiagnostics Nippon Genetics Europe
  • Products: AusDiagnostics’ PlexWell technology and products for multiplexed NGS applications
  • Territory: in Germany, Austria
  • Exclusive
Mobidiag Ibn Rushd Medical & Scientific Equipment
  • Products: Mobidiag’s Novodiag antibiotic resistance testing products
  • Territory: Kuwait
  • Exclusive, 2-year deal
Mobidiag Interlab Interautomatika UAB
  • Products: Mobidiag’s Amplidiag and Novodiag infectious disease and antibiotic resistance testing products
  • Territory: Latvia, Lithuania
  • 2-year deal
Mobidiag Helix2
  • Products: Mobidiag’s Amplidiag and Novodiag infectious disease and antibiotic resistance testing products
  • Territory: Greece
  • 2-year deal
LICENSES
Licensor Licensee Deal Summary
Translational Genomics Research Institute Advanced Biological Laboratories
  • Property: NGS-based DeepCheck-TB test for tuberculosis
  • Advanced to distribute test which is available for research only
Washington University in St. Louis Q BioMed
  • Property: Biomarker, growth differentiation factor 15 (GDF15) for determining severity of glaucoma
  • Exclusive
Zymo Research Pangea Laboratory
  • Property: Urine-based laboratory-developed test for bladder cancer detection
  • Test, called Bladder Care, uses qPCR to measure methylation level of three bladder cancer-specific biomarkers in urine samples
SUPPLY, SERVICE & TESTING AGREEMENTS
Supplier/Servicer Client/User Deal Summary
GE Healthcare Bio-Sciences T2 Biosystems
  • GE Healthcare Bio-Sciences to manufacture and supply proprietary superparamagnetic particles for use with T2 Bio’s products
Quest Diagnostics Regional Medical Center (Orangeburg, SC)
  • Quest to provide full lab management services, including lab equipment, supplies and procurement processes
NEW CLINICAL STUDIES
DX Partner Other Partner Description of Study
Helomics Viome
  • Partnership to investigate associations between ovarian cancer and the gut microbiome
uBiome University of Louisville
  • Study whether the microbiome can be used to predict patient responses to certain inflammatory bowel disease therapies
Geisinger Health Johns Hopkins University
  • Study whether a liquid biopsy test that combines targeted circulating tumor DNA analysis with different protein markers can detect cancer early in healthy individuals
Oxford Biodynamics The Wellcome Trust + The Urology Foundation + British Medical Association
  • OBD’s EpiSwitch test for blood-based diagnosis of prostate cancer to be evaluated as part of ongoing PROSTAGRAM trial assessing methods for early-stage prostate cancer detection 
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