DIAGNOSTIC DEALS

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:

MERGERS, ACQUISITIONS & ASSET SALES
Acquiring Company Target(s) Deal Summary
Illumina Pacific Biosciences
  • Price: $1.2 billion cash ($8 per share, representing 71% premium over market for 30 days ending Oct. 31, 2018)
  • Status: Closing delays due to antitrust regulatory concerns in UK (see above)
  • PacBio long-read sequencing technology complements Illumina short-read sequencing platforms and enables it to provide integrated workflows and innovations that leverage both technologies
Exact Sciences Genomic Health
  • Price: $2.8 billion in cash and stock
  • Status: Closed
  • Genomic Health common shareholders to get per share price of $27.50 in cash and $44.50 in shares of Exact stock, subject to 10% collar based on Exact’s volume-weighted average price for 45 trading days ending July 26
  • Create cancer DX megafirm that unites Exact’s Cologuard with Genomic Health’s Oncotype DX
Invitae Clear Genetics
  • Price: $50 million—half in cash, half in common stock
  • Status: Closed
  • Invitae secures access to Clear Genetics’ chatbot Gia, or Genetic Information Assistant, which is already being used by customers ordering genetic testing via Invitae’s direct channel
Abcam Expedeon
  • Price: €120 million ($130 million) cash
  • Status: Deal requires Expedeon shareholder approval at meeting to be held Dec. 19
  • Abcam to acquire Expedeon’s core proteomics business + immunology-focused subsidiaries (Innova Biosciences + TGR Biosciences)
  • Expedeon plans to change its name + focus on genomics operations
  • Expedeon to keep its San Diego-based operations
Discovery Life Sciences QualTek Molecular Laboratories
  • Price: Undisclosed
  • Status: Closed
  • Acquisition of immunohistochemistry services provider broadens range of Discovery’s histopathology services + supports development of innovative flow cytometry + cell-based lab services
Edan Diagnostics LGC
  • Price: Undisclosed
  • Status: Closed
  • Edan acquires LGC’s Clarilight molecular diagnostics, point-of-care platform
  • Firms also to partner to develop molecular diagnostic assays designed for Clarilight with Edan to develop, manufacture, market and sell the instrument + test cartridges
LabCorp South Bend Medical Foundation (SBMF)
  • Price: Undisclosed
  • Status: Closed
  • LabCorp acquires SBMF’s diagnostic clinical lab testing business in Indiana
STRATEGIC ALLIANCES, PARTNERSHIPS & COLLABORATIONS
Partner 1 Partner(s) 2+ Deal Summary
Agilent Technologies MGI Tech
  • Objective: Integrate Agilent’s laboratory information management system with MGI’s sequencing platforms
  • Dynamic: Combine Agilent’s SLIMS system + MGI’s DNBSeq sequencing platforms + life science instruments to seamlessly connect hardware + software
Agilent Technologies Akadeum Life Sciences
  • Objective: Develop new method of isolating target molecules for analytical workflows
  • Dynamic: Akadeum to apply its new technology that uses microbubbles to separate molecules + circulating tumor cells in liquid biopsies for downstream applications
Centogene Pfizer
  • Objective: Enable Pfizer to use Centogene’s rare disease data repository to develop new drugs
  • Dynamic: Centogene to help Pfizer mine depository data + substantiate resulting data in exchange for an unspecified upfront payment
  • Centogene also eligible for future payments for any additional collaborative research projects
Promega Merck
  • Objective: Develop on-label, solid tumor companion diagnostic for Merck’s anti-PD1 immunotherapy pembrolizumab (Keytruda) using Promega’s microsatellite instability (MSI) technology
  • Dynamic: Global collaboration in which firms to seek regulatory approval for Promega MSI CDx in US, China + maybe other countries in the future
SomaLogic Novartis
  • Objective: Leverage SomaLogic’s SomaScan proteomics platform to develop new drugs
  • Dynamic: Under 10-year deal, SomaLogic to analyze at least 250,000 clinical samples provided by Novartis + use resulting data for its own proteomic test development work
  • Firms have partnered since 2011
Proscia Dell Technologies
  • Objective: Develop cost-effective, scalable IT infrastructure for deploying digital pathology solutions
  • Dynamic: Collaboration to provide reference architectures for whole-slide image viewing and managing, including Proscia’s Concentriq platform
Oncimmune Biodesix
  • Objective: Commercialize EarlyCDT Lung in US
  • Dynamic: Biodesix to acquire Oncimmune CLIA lab facilities in Kansas + pay Oncimmune $1.0 million in quarterly instalments of $250K
  • Oncimmune grants Biodesix option (exercisable by the end of 2020) to commercialize EarlyCDT Lung as screening diagnostic for lung cancer in US in exchange for a further cash payment
  • Biodesix gets right to renew for additional 5 years
Illumina Lexent Bio
  • Objective: Develop in vitro diagnostic kit for cancer
  • Dynamic: Non-exclusive partnership under which Lexent will develop its Confera Dx assay, NGS-based kit for monitoring response to therapy or minimal residual disease in patients with certain solid tumors, to run on Illumina’s NextSeq 550Dx system
  • Lexent responsible for securing regulatory approvals + commercializing kit
Thermo Fisher Scientific Owlstone Medical
  • Objective: Discover + validate early cancer detection biomarkers by noninvasive breath sampling
  • Dynamic: Thermo Fisher to qualify its mass analyzers for detection of new biomarkers by integrating its Q Exactive GC Hybrid Quadrupole-Orbitrap gas chromatography mass spectrometer (GC-MS) into Owlstone’s Breath Biopsy platform
Thermo Fisher Scientific Genialis
  • Objective: Create integrated workflow to ease the data-analysis bottleneck for RNA sequencing
  • Dynamic: Comarketing agreement integrating Thermo Fisher’s Invitrogen Collibri Stranded RNA Library Prep Kit for Illumina NGS systems with Genialis’ Expressions analysis software
Thermo Fisher Scientific Milu Labs
  • Objective: Develop clinical diagnostic technologies for women’s health in China
  • Dynamic: Use Thermo Fisher’s liquid chromatography-mass spectrometry instrumentation to develop tools assessing risk for adverse pregnancy outcomes, including a clinical mass spectrometry-based proteomics assay
Lucence Diagnostics MEDx (Suzhou) Translational Medicine
  • Objective: Develop cancer-related companion diagnostic tests for China
  • Dynamic: Tests to be codeveloped for PD-L1 rearrangement to be used with anti- PD1/PD-L1 cancer immunotherapies
Abcam BrickBio
  • Objective: Use BrickBio’s bioconjugation platform to develop research + diagnostic products
  • Dynamic: Abcam gets exclusive right to use platform to create conjugation-ready recombinant products for research tools market
  • Abcam also gets right to commercialize platform across its recombinant antibody + protein portfolio
  • Abcam also gets undisclosed equity stake in BrickBio
SpeeDx QuantuMDx
+
Foundation for Innovative New Diagnostics (FIND)
  • Objective: Assess feasibility of porting SpeeDx sexually transmitted infection tests to the QuantuMDx point-of-care testing device
  • Dynamic: SpeeDx to use its PlexPCR technology to develop multiplex tests for common STIs, including gonorrhea and Mycoplasma genitalium, to be run on QuantuMDx Q-POC device with FIND to fund project
Targos Molecular Pathology Ultivue
  • Objective: Provide standardized multiplex phenotypic assays to pharmaceutical companies for characterization of samples selected for clinical research programs
  • Dynamic: Leverage Ultivue’s UltiMapper assays, which are used in tumor immune-profiling research strategies to demonstrate clinical utility of panels of markers
Hitachi Centre Léon Bérard (CLB)
  • Objectives: i. Develop diagnostic imaging technologies to detect cancer sites + improve diagnosis from CT + MRI scans; ii. Identify biomarkers from genomic data to predict response to radiation treatment
  • Dynamic: Establish new research laboratory called The Hitachi Lyon Lab, housed at CLB’s facilities in France
OptraHealth InformedDNA
  • Objective: Make InformedDNA’s network of genetic counselors remotely available to users of OptraHealth GeneFax system
  • Dynamic: Telegenetics partnership enabling consumers on the GeneFax Counselor Connect scheduling platform to reach InformedDNA counselors online to ask questions about genetic + prenatal testing
Mission Bio BioLegend
  • Objective: Provide simultaneous DNA analysis + protein detection in single cells
  • Dynamic: Codevelop a sample preparation solution for Mission Bio’s Tapestri platform + create hematology-focused catalog panel to launch in 2020
Qiagen Repertoire Genesis
  • Objective: Develop companion diagnostic tests on Illumina sequencing platforms that use Repertoire Genesis’ TCR technology in immuno-oncology
  • Dynamic: Non-exclusive worldwide cross-marketing + promotion agreement under which Repertoire Genesis to give Qiagen access to technologies for development of T cell + B cell receptor repertoire sequencing assays
Akoya Biosciences Precision for Medicine (formerly ApoCell)
  • Objective: Develop liquid biopsy + tissue biomarker assays using Akoya’s Vectra Polaris system
  • Dynamic: Combine Vectra Polaris system with Precision for Medicine’s ApoStream technology, using both tumor biopsies + liquid biopsies to generate data for assessing drug efficacy + validating companion diagnostics
Sysmex Optim
  • Objective: Form joint venture to develop and operate digital medicine platforms
  • Dynamic: Latest initiative of business alliance created in Feb. 2019 to combine Sysmex’s global sales + service network with Optim’s AI + data management technologies, including the Optim Cloud IoT OS
  • Joint venture to develop + test new diagnostic methods that combine image information from gene tests with AI analysis
  • Joint venture to collaborate with pharma companies + medical device manufacturers
Sienna Cancer Diagnostics Minomic International
  • Objective: Develop test for early detection of pancreatic cancer
  • Dynamic: Sienna to use NET molecular capture technology it acquired in April 2019 + also provide Exo-NET beads, an exosome capture technology
Twist Bioscience  MGI International Sales (BGI subsidiary)
  • Objective: Comarket Twist’s sequencing target enrichment products in Europe + Asia Pacific
  • Dynamic: Under non-exclusive agreement, firms to make Twist’s NGS target enrichment kits available on MGI’s sequencing platforms
  • Covered products include the Twist Human Core Exome, Twist Mouse Exome, Twist RefSeq, Twist Universal Blockers, Twist Fast Hybridization and Wash kits, and Twist’s custom panels
Mologic Sherlock Biosciences
  • Objective: Develop tests that combine lateral flow + molecular diagnostic technologies for use in low-resource settings + the home
  • Dynamic: Collaboration aiming to collaboration aims to advance affordable platforms for detecting DNA or RNA targets in virtually any decentralized site being funded via expansion of existing grant from The Bill & Melinda Gates Foundation
PredictImmune KSL Biomedical
  • Objective: Commercialize PredictImmune PredictSURE inflammatory bowel disease test in North America
  • Dynamic: Under exclusive commercial partnership, KSL to commercialize + facilitate fulfillment of orders for the test, and receive + process samples through its KSL Diagnostics testing lab
Microba Psomagen (subsidiary of Psomagen)
  • Objective: Launch microbiome analysis test in US before the end of 2019
  • Dynamic: Microba recently launched Insight, a direct-to-consumer service in Australia that uses shotgun metagenomics to analyze customers’ gut microbiomes + generate a personalized report
DISTRIBUTION, SALES & MARKETING AGREEMENTS
Property Owner Distributor Deal Summary
 Biocartis Nichirei Biosciences
  • Products: Biocartis’ Idylla products
  • Territory: Japan
Eurobio Scientific CirrusDx
  • Products: Eurobio’s T-COR 8 molecular biology platform
  • Territory: France + Maghreb countries of North Africa, including Algeria, Libya, Mauritania, Morocco, Tunisia, Western Sahara
Pillar Biosciences MGI Tech
(subsidiary of BGI)
  • Products: Pillar’s Onco/Reveal next-generation sequencing panels
  • Territory: Comarketing deal covering outside the US
BillionToOne Eluthia
  • Products: BillionToOne’s Unity noninvasive prenatal test
  • Territory: Germany, Austria, Switzerland, Netherlands
  • Exclusive
Nippon Genetics GeneX India
  • Products: Nippon Genetics’ cell and molecular biology research products
  • Territory: India
  • Exclusive
Veritas Intercontinental Genomika
  • Products: Veritas’ whole-genome and exome sequencing services
  • Territory: Brazil
Mobidiag Alab
  • Products: Mobidiag’s Amplidiag and Novodiag molecular diagnostic products
  • Territory: Poland and Ukraine
  • Exclusive
Mobidiag Biogenetix
  • Products: Mobidiag’s Amplidiag and Novodiag molecular diagnostic products
  • Territory: Romania
  • Exclusive
Mobidiag Theranostica
  • Products: Mobidiag’s Amplidiag and Novodiag molecular diagnostic products
  • Territory: Israel
  • Exclusive
PredictImmune Theradiag
  • Products: PredictSure IBD test
  • Territory: France, Belgium, Luxembourg, Switzerland, Maghreb countries in northwest Africa
  • Exclusive licensing, promotion + distribution partnership
MDNA Life Sciences Mediwell Enterprise
  • Products: MDNA’s PCR-based Mitomic Prostate Test (MPT) liquid biopsy assay
  • Territory: Singapore, Malaysia, Vietnam, Thailand, Brunei, Myanmar, Philippines, Indonesia
  • Exclusive
DNAStar Inqaba Biotechnical Industries
  • Products: DNAStar’s Lasergene DNA, RNA and protein sequence analysis software
  • Territory: Africa
LICENSES
Licensor Licensee Deal Summary
University of Pittsburgh Medical Center Sonic Healthcare USA
  • 15-year agreement expanding existing exclusive license allowing Sonic to offer the ThyroSeq Genomic Classifier test at all of its US clinical labs and anatomic pathology practices
  • Previously, Sonic could offer the test only through its CBLPath division
University of Bonn Qiagen
  • Qiagen licenses epigenomic biomarkers based on immune checkpoint gene methylation
  • Qiagen also gets rights to codevelopment of predictive companion diagnostics for use in selecting patients likely to benefit from immuno-oncology therapies
Stratifyer Molecular Pathology Qiagen Qiagen gets exclusive access to biomarker intellectual property providing guidance for treatment of bladder and, potentially, other urothelial cancers
SUPPLY, SERVICE & TESTING AGREEMENTS
Supplier/Servicer Client/User Deal Summary
Quanterix Siemens Healthineers
  • Quanterix to provide Siemens Healthineers access to neurofilament-light (Nf-L) antibodies for use in developing blood-based Nf-L clinical tests
NEW CLINICAL STUDIES
DX Partner Other Partner(s) Description of Study
PredictImmune Crohn’s & Colitis Foundation
  • Study to validate PredictImmune’s PredictSure IBD test by tracking up to 200 patients from 15 medical centers across the US who have Crohn’s disease or ulcerative colitis and aren’t receiving systemic steroids, immunomodulators or biologics
Inivata European Organization for Research + Treatment of Cancer
  • Pfizer-funded Phase II trial using Inivata’s InVisionFirst-Lung test to test lung cancer patients under being treated with the ALK inhibitor lorlatinib (marketed as Lorbrena)
ACT Genomics University of California, San Diego Moores Cancer Center
  • Study to evaluate gene expression signals associated with tumor microenvironment that may predict outcome in melanoma patients treated with PD-1 inhibition
Guardant Health NA
  • ECLIPSE trial (Evaluation of ctDNA Lunar Assay In an Average Patient Screening Encounter), a 10,000-patient observational study evaluating performance of firm’s Lunar-2 circulating cell-free DNA test in detecting colorectal cancer in average-risk adults
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