M&A Report

M&A Report: Roche Merges with GenMark Diagnostics to Create Syndromic Testing Powerhouse

After a slow start to the year, M&A activity in the diagnostics space accelerated noticeably in March, both in terms of deal volume and impact. The highlight of the month was the March 15 announcement of Roche’s agreement to acquire GenMark Diagnostics for approximately $1.8 billion in cash.

Terms of the Deal

The deal will actually take the form of a merger carried out in two stages:

  • First, Roche will initiate a tender to acquire all outstanding shares of GenMark common stock at $24.05 per share, representing a premium of approximately 43 percent to the closing price on Feb. 10, the last day of trading before published reports rumoring a GenMark acquisition, which caused share prices to skyrocket by 27 percent; and
  • Once the first merger ends, Roche will acquire the remaining common shares at the same price via a second step merger.

The deal has been unanimously approved by the boards of both companies and is slated to close in the second quarter.

Strategic Significance

Unlike some other recent high-profile M&A deals, there’s a strong fit between Roche and GenMark. GenMark’s portfolio of syndromic panel tests and products, including the ePlex platform, complement Roche’s own molecular diagnostics product lines. GenMark’s “proven expertise in syndromic panel testing provides faster targeted therapeutic intervention, resulting in improved patient outcomes and reduced hospital stays,” noted Roche Diagnostics CEO Thomas Schinecker in a statement, “and will contribute to Roche’s commitment to helping control infectious diseases and antibiotic resistance.” And by joining forces with a global powerhouse like Roche GenMark will be able to vastly expand its market reach.

The firms even have complementary COVID-19 products. GenMark produces Respiratory Pathogen Panels for identifying pathogens associated with SARS-CoV-2 and other upper respiratory infections while Roche offers a variety of different COVID-19 tests.

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

Mergers, Acquisitions & Asset Sales

Acquiring Company Target(s) Deal Summary
Roche GenMark Diagnostics
  • Price: Roughly $1.8 billion in cash
  • Status: Expected to close in Q2
  • Acquisition of GenMark’s syndromic panel testing products complements and bolsters Roche’s molecular diagnostics portfolio
Thermo Fisher Scientific Mesa Biotech
  • Price: Up to $591 million including $491 million cash up front and up to $100 million cash if milestones reached
  • Status: Closed
  • Acquisition of molecular test firm with 500 employees that sells PCR-based rapid point-of-care platform for infectious diseases, including SARS-CoV-2, influenza A and B, RSV and Strep A
Agilent Technologies Resolution Bioscience
  • Price: $550 million cash up front + up to $145 million more if performance milestones reached
  • Status: No closing date announced
  • Agilent moves into liquid biopsy market via acquisition of Revolution Bioscience’s NGS-based noninvasive liquid biopsy test platform designed for both centralized CLIA test services and distributable kits
Hologic Diagenode
  • Price: $159 million in cash
  • Status: Closed
  • Acquisition of privately held molecular test maker that produces 30 real-time CE-marked PCR tests for bacteria, parasites, and viruses involved in sexually transmitted infections, respiratory diseases, meningitis and gastroenteritis
PerkinElmer  Oxford Immunotec
  • Price: $591 million cash representing $22 for each outstanding share of Oxford, a 28.3% premium on Jan. 5 closing price
  • Status: Closed
  • Acquisition enables PerkinElmer to add tuberculosis detection to its infectious disease testing portfolio
Insightful Science Dotmatics
  • Price: Undisclosed
  • Status: Expected to close in Q2
  • Merger integrating Insightful’s bioinformatics with Dotmatics’ enterprise data management technology to create scientific research platform to improve lab efficiency
DiamiR Interpace Biosciences
  • Price: Undisclosed
  • Status: Expected to close in April
  • DiamiR expands its capacity to develop and commercialize microRNA-based tests by acquiring Interpace’s CLIA-certified lab in New Haven, CT
CareDx BFS Molecular
  • Price: Undisclosed
  • Status: Closed
  • BFS Molecular produces software that uses NGS data to track the health of transplanted organs and stem cells over time
Veracyte Decipher Biosciences
  • Price: $600 million, including $250 million cash and $350 million in Veracyte shares, subject to Veracyte’s option to pay some or all of that $350 million in cash rather than stock
  • Status: Closed
  • Acquisition of leading producer of urologic cancer diagnostics, including Decipher Prostate Biopsy and post-radical prostatectomy tests
  • Decipher to become wholly owned subsidiary of Veracyte
Integrated DNA Technologies (Danaher subsidiary) Swift Biosciences
  • Price: Undisclosed
  • Status: Closed
  • IDT acquires next-generation sequencing library preparation firm
Quest Diagnostics Mercy
  • Price: Undisclosed
  • Status: Closed
  • Quest acquires healthcare system’s outreach lab services business consisting of 29 Mercy hospital labs and 2 independent clinical labs in Arkansas, Kansas, Missouri and Oklahoma
C2i Genomics QNA Dx
  • Acquisition of CLIA-certified sequencing lab speeds C21’s efforts to commercialize its MRDetect cancer monitoring platform
Bio-Techne Asuragen
  • Price: $215 million in cash up front + up to $105 million if Asuragen meets future milestones
  • Status: Expected to close in Q4
  • Bio-Techne to use cash on hand and its own revolving fund to acquire developer of genetic carrier screening and oncology testing kits using proprietary chemistries for testing platforms that are widely available
10x Genomics Tetramer Shop
  • Price: Undisclosed
  • Status: Closed
  • Acquisition of Denmark-based T cell detection startup bolsters 10x Genomics’ presence in the immunology space
Oncocyte Razor Genomics
  • Price: $10 million cash + 982,318 shares of Oncocyte common stock
  • Status: Closed
  • Oncocyte becomes sole shareholder of firm, which developed what has now become the firm’s first commercial assay, DetermaRx
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