PerkinElmer Turns COVID Cash into Acquisitions While Myriad Genetics Keeps Divesting

After a frantic month marked by an unusually high number of blockbusters, M&A deal making was relatively slow in May in terms of both deal volume and value. Still, the pace of strategic M&A transactions has just about returned to where it was before the pandemic as massive COVID-19 cash windfalls burn a hole in test makers’ pockets. Here’s a quick rundown of the two biggest deal makers and the diametrically opposite strategies they’re pursuing.

PerkinElmer Continues Its Buying Spree

No diagnostics firm has made more M&A deals in 2021 than PerkinElmer. With 146% net operating cash flow growth in the first quarter of 2021, PerkinElmer’s cash flow exceeded its total for all of 2019, or in any other year for that matter. The firm is now parlaying that COVID-generated cash into strategic acquisitions. It began in January when PerkinElmer plunked down $591 million to acquire Oxford Immunotec in an apparent bid to challenge Qiagen for the tuberculosis testing market. This month, the company made two more big M&A moves.

On May 13, PerkinElmer announced that it had reached an agreement to buy Nexcelom Bioscience for $260 million in cash. Founded in 2003, Nexcelom produces tools and instruments for cell counting and analysis, as well as fit-for-purpose cell counting method selection and development instruments that follow ISO cell counting standards for use in development of cell, gene, and immune-oncology therapies, virology drugs, and vaccines. PerkinElmer CEO Prahlad Singh said the acquisition would expand the company’s “efforts to help academic, government, and biopharmaceutical organizations streamline their complete workflows and support efforts to accelerate time to target and time to market for novel therapies.”

Four days after the Nexcelom buy, PerkinElmer struck again by agreeing to shell out $155 million in cash for Immunodiagnostic Systems (IDS) to bolster its immunodiagnostics business. PerkinElmer plans to fold the UK-based firm’s chemiluminescence products for endocrinology, autoimmunology and infectious diseases into its Euroimmun business. “This proposed transaction is highly valuable for both parties as the respective product lines are to a large extent complementary,” noted Euroimmun CEO Wolfgang Schlumberger in a statement.

Myriad Genetics Continues Its Selling Spree

Myriad Genetics, which is under new management, has been pursuing the precisely opposite strategy by divesting assets as part of a strategic corporate restructuring. Over a span between April 27 and May 26, Myriad announced three sell-off deals, including in reverse chronological order:

• Sale of its Myriad RBM contract research services for the pharmaceutical industry to IQVIA subsidiary Q² for an undisclosed price with the deal scheduled to close in the third quarter;
• Sale of its Vectra blood-based proteomic rheumatoid arthritis test and related intellectual property and assets to LabCorp for $150 million in cash; and
• Sale of its Myriad myPath Melanoma Utah lab and test to Castle Biosciences for $32.5 million in cash.

The divestitures, which are likely to continue, enable Myriad Genetics to focus on its core women’s health, oncology and mental health while freeing up growth capital for future investment.

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

MERGERS, ACQUISITIONS & ASSET SALES