BioMérieux to fork over $450M for Utah Dx outfit
French diagnostics developer bioMérieux is ponying up $450 million for the newly renamed BioFire Diagnostics, a move that helps consolidate its position in infectious disease testing with one strategic move. The move also reflects a serious sign of life for the overall sector.
What's more, bioMérieux chairman and CEO Jen-Luc Belingard envisions using BioFire's Salt Lake City, UT, headquarters and its 500-plus employees as a base from which to build a greater presence in molecular diagnostics down the line. (bioMérieux has been better known globally for in vitro diagnostics.)
"BioFire's site will become our hub for our expansion in molecular biology," Belingard said in a statement, adding he expects that BioFire's employees will collaborate closely with bioMérieux teams at the company's Grenoble and Verniolle sites in France.
The deal includes the $450 million purchase price plus BioFire's net financial debt. If all goes well, the buyout should conclude by the end of the current fiscal year or in early 2014, the companies said.
BioFire launched 20 years ago and was most recently known as Idaho Technology. The company raised a $45 million cash infusion earlier this year from the likes of Athyrium Opportunities Fund, with plans to use the money to hasten the commercial rollout of its FilmArray Diagnostic platform. The first panel--a respiratory test--looks at 20 viruses and bacteria in 60 minutes and has a CE mark and FDA clearance. But FilmArray tests for sepsis, diarrhea, meningitis and pneumonia are either close to FDA approval or in the pipeline, and the sepsis test has a CE mark. And the company has another automated molecular test it licensed to Roche Diagnostics ($RHHBY).
As well, BioFire has been adding hundreds of jobs, in part because of a $25 million tax credit from the state of Utah. And the company has a number of biodefense customers, bioMérieux notes, including the U.S. Department of Defense and its allies--a lucrative business on its own. So bioMérieux gets an acquisition with lots of potential.
Naturally, bioMérieux is quick to use the phrase "strategic synergies" to describe the rationale behind its bid for the company, noting that FilmArray will be a key part of its own development of infectious disease diagnostics. The company said it expects FilmArray to be ready within three years with tests for over 70 disease agents responsible for respiratory, gastrointestinal and blood infections. As well, bioMérieux said it expects its massive commercial network, particularly in North America and Europe, will help BioFire's products reach more people, and that its ability to automate reagent production should make manufacturing costs ideal.
BioFire is expected to book $70 million in sales in 2013, $40 million from FilmArray, according to the deal announcement.
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