Diagnostic Deals: The Fate of Illumina-PacBio Merger Hangs in the Balance

Will they or won’t they? The suspense continues over whether Illumina’s proposed rescue of Pacific Biosciences will actually close. The $1.2 billion cash merger, which was originally expected to close in mid-2019, is now on indefinite hold due to regulatory antitrust concerns. After promising to make a ruling by Dec. 11, the UK Competition and Markets Authority (CMA) has now expanded and extended its review until Feb. 5, 2020.

The move follows an attempt by Illumina to rescue the deal by proposing to offer perpetual, royalty-free licenses to PacBio patents to competitors in the sequencing market. But one of those competitors, Oxford Nanopore Technologies, was less than impressed with what it described as an “illusory offer which does little to offset the anticompetitive effects of the proposed merger either in the UK, or on a worldwide basis.” Whether CMA agrees remains to be seen. Meanwhile, Illumina will keep pumping cash into struggling PacBio in the hopes of consummating the acquisition.

The other big development was the closing of Exact Sciences’ acquisition of fellow cancer genetics testing firm Genomic Health. The merged companies will be restructured as a four-unit business with separate teams managing Exact’s Cologuard business, Genomic Health’s Oncotype DX business, international business initiatives and combined pipeline opportunities.

Here’s a summary of key diagnostic deals announced from late October through the third week of November: