QIAGEN Acquires DxS Ltd - Creating Leadership in Personalized
Healthcare
(Thomson Reuters ONE) - Corporate news announcement processed and transmitted by Hugin AS.The issuer is solely responsible for the content of this announcement. ------------------------------------------------------------------------------------ In addition, QIAGEN unveils for the first time its companiondiagnostic pipeline, which the Company believes is unmatched in terms of depth and profileVENLO, The Netherlands, September 22, 2009 - QIAGEN N.V. (NASDAQ:QGEN; Frankfurt, Prime Standard: QIA) today announced that it hasacquired DxS Ltd (DxS), a privately-held developer and manufacturerof companion diagnostic products headquartered in Manchester, UnitedKingdom. The transaction is valued at approximately US$ 95 million incash (subject to customary purchase price adjustments), plus up to anadditional US$ 35 million if specified commercial and othermilestones are met.With this acquisition, QIAGEN has taken a strong leadership positionin the new era of personalized healthcare (PHC). The Company believesit offers all the required elements to help drive and shape thisrapidly emerging trend in healthcare.In addition, QIAGEN unveiled for the first time that the combinedcompany is currently active in over 15 collaborations withpharmaceutical companies to market and / or develop companiondiagnostic products. The programs span genetic, expression,epigenetic and other markers. QIAGEN believes that this pipeline isthe deepest such portfolio in the pivotal field of moleculardiagnostics for personalized healthcare.Acquisition of DxSThe acquisition of DxS brings to QIAGEN a portfolio of moleculardiagnostic assays and intellectual property, as well as a deeppipeline of active or planned companion diagnostic partnerships inoncology with many of the leading pharmaceutical companies, includingseven of the largest drug makers in this field. These assetscomplement QIAGEN's existing strong portfolio of personalizedhealthcare diagnostic solutions and are very synergistic withQIAGEN's sample and assay technologies.DxS has developed a set of molecular diagnostic assays which allowphysicians in oncology to predict patients' responses to certaintreatments in order to make cancer therapies more effective andsafer. The currently marketed portfolio spans seven real-time PCRtests including a test for the mutation status of the oncogene K-RAS,which is indicative for successful treatment of patients sufferingfrom metastatic colorectal cancer (mCRC) with EGFR inhibitors. Inaddition, three assays are in the near-term pipeline and furtherassays are in the medium-term pipeline. DxS' portfolio of assays,both marketed and in its pipeline, is strongly suitable for use withQIAGEN's existing suite of platform instruments, includingQIAsymphony and Rotor-Gene Q.DxS is one of the pioneers which have brought molecular companiondiagnostics to market. The TheraScreen: K-RAS Mutation Kit® developedby DxS has already been CE-marked. In the United States, the test isexpected to be submitted to the FDA for regulatory approval (PMA) in2010. It is estimated that in the future the market for overall K-RAStesting could reach up to US$ 100 million. DxS' current portfolio andnear-term pipeline includes ten unique and proprietary assays. Thecompany has accumulated a significant intellectual property portfoliofor its current and planned diagnostic content."The acquisition of DxS is strategically a highly importanttransaction for QIAGEN. It combines two leadership positions tocreate a very powerful leader in a transformational area ofhealthcare: personalized healthcare. This transaction is a keyelement of our strategy to lead in molecular diagnostic-basedprevention, profiling and personalized healthcare. These threeelements are expected to significantly shape and contribute to futureimprovements in healthcare and have the potential to providesignificant benefits to patients as well as exceptional value forpayers, providers, and the pharmaceutical industry", said Peer M.Schatz, CEO of QIAGEN."QIAGEN is the ideal partner for DxS to globally roll out our assays,to take our partnerships to the next level and to take a leadershipposition in companion diagnostics", said Stephen Little, founder andCEO of DxS. "Unlike any other company, we believe that QIAGENaddresses the broadest range of companion diagnostic options forpharmaceutical and large biotech companies - starting from anindependent sales reach over broad technology, R&D and manufacturingcapabilities up to expertise in regulatory affairs and accesscreation to physicians and laboratories.""This combination has the potential to create a classical win-winsituation for everyone involved", said Peer Schatz. "We believe thatQIAGEN can use its enhanced strategic position to leverage theopportunities in personalized healthcare: pharma customers canbenefit from a stronger, independent and focused partner to betterserve their special development needs, employees can benefit fromenhanced career opportunities, physicians can benefit from fasteraccess to better tools for diagnosis and treatment, and healthcaresystems can benefit from the potential for increases in effective andefficient treatments. But most importantly, patients who suffer fromserious diseases, such as cancer, stand to benefit significantly fromthese new trends in personalized healthcare, which can lead to theavoidance of unnecessary or even harmful treatments and therefore toan increase in the quality of their lives."DxS' senior management will join QIAGEN in leading roles in theCompany's rapidly expanding personalized healthcare focus area,facilitating rapid integration and focus on the further expansion ofthis key segment. For that purpose, QIAGEN intends to establish DxS'headquarters in Manchester as a Center of Excellence in PharmaPartnering. Given the high level of synergies, QIAGEN expects to growthe Manchester location.Transaction Highlights * QIAGEN believes it has taken a leadership position in molecular diagnostics for personalized healthcare, positioned to help drive and shape this rapidly emerging trend. * QIAGEN unveils for the first time the depth of its partnered companion diagnostics pipeline and is now active in over 15 partnerships. This is believed to be one of the deepest such pipelines in the industry. * QIAGEN expands leadership in personalized healthcare, a key pillar in the Company's strategy to focus on molecular diagnostic-based prevention, profiling, and personalized healthcare. * QIAGEN creates a leading portfolio in companion diagnostics: * DxS adds seven PCR assays targeting biomarkers including K-RAS and EGFR29, which may be useful in identifying patients' response to certain cancer treatments (e.g. colon, lung cancer). * QIAGEN's existing portfolio already included pyrosequencing-based K-RAS, BRAF and methylation assays targeting biomarkers, as well as large numbers of gene expression and miRNA assays for discovery of future biomarkers and instrument platforms to automate these tests. * Accretion to adjusted EPS beyond the year 2010. * Very synergistic; minimal overlap and seamless integration expected. DxS' senior management will continue to assume leading positions in expanding QIAGEN's partnerships with pharma and biotech in companion diagnostics.Financial DetailsUnder the terms of the agreement, QIAGEN acquired the entireoutstanding share capital in DxS. QIAGEN expects to incur one-timecharges of approximately US$ 0.02 in EPS in the third quarter 2009 inconnection with this acquisition. These charges primarily relate toconsulting and advisory fees incurred in connection with theacquisition and the write-off of certain assets. In addition, basedon preliminary analyses and following the streamlining of theportfolio, QIAGEN expects this transaction to contributeapproximately US$ 6 million in sales in the remainder of 2009 andapproximately US$ 30 million in sales in 2010. On an adjusted basisexcluding one-time charges, integration and restructuring costs, andamortization of acquisition related intangible assets, theacquisition is expected to be neutral to EPS in the remainder of 2009and to be dilutive by US$ 0.02 in 2010. Beyond 2010, it is expectedthat the acquisition will be accretive to adjusted EPS. Jefferiesacted as exclusive financial advisors in this transaction.About QIAGEN in Molecular DiagnosticsWith a run-rate over US$ 450 million in sales and rapid growth inthis segment, QIAGEN believes it is a leader in moleculardiagnostics, excluding viral load testing and blood screening.QIAGEN has defined three segments in laboratory-based moleculardiagnostics it is focusing on:1) Prevention: This segment covers markers tested for in asymptomaticpatients for the purpose of early disease or risk detection and inregular intervals. These assays are typically performed bylaboratories in high volumes. QIAGEN's portfolio in HPV testing and,in addition, the panel of assays in development (including tests forchlamydia and gonorrhea) address the most attractive and fastestgrowing segments in Prevention. These assays can be performed oncurrent systems and on QIAGEN's QIAensemble platform. This platformis expected to be launched in late 2010 in Europe and in mid 2012 inthe United States and is expected to set a new standard in moleculardiagnostic screening in terms of throughput and utility.2) Profiling: This segment covers tests performed on symptomaticpatients to create or confirm a diagnosis. The assays are mostlyperformed at lower throughputs, but are often of higher value pertest. QIAGEN's portfolio of molecular diagnostic assays (>80) forpathogens is considered one of the broadest in the world and is usedto detect and profile pathogens. This segment also includes a numberof genetic and other assays.3) Personalized Healthcare: QIAGEN believes that this is the mosttransformative area of molecular diagnostics. These assays are usedto guide therapy for pre-diagnosed symptomatic patients. They aretypically higher value, lower volume assays. QIAGEN today sellsapproximately 20 assays in personalized healthcare.In Personalized Healthcare and Profiling throughput requirements arelower than in the segment of Prevention, but the bandwidthrequirements (sample types, etc.) are much higher. The random access,continuous load QIAsymphony platform (sample to result, of which thefirst modules have been very successfully launched) was designed forthese segments.About QIAGEN in Personalized HealthcareQIAGEN believes it brings a special value proposition topharmaceutical companies for companion diagnostics developmentprojects. The Company is considered a key partner as it is: * The largest molecular diagnostics company based on revenues, technology and portfolio breadths, outside blood screening/viral load testing. * A significant supplier to pharmaceutical discovery and development already today. * Owner of a broad technology portfolio in molecular sample & assay technologies. * Independent: not owned by a pharmaceutical company. * A company with strong regulatory presence, sales channel strength and global reach.About Companion Diagnostics and Personalized HealthcareCompanion diagnostics are expected to become a key contributor to thetransformational trend towards personalized healthcare (PHC). Inaddition to the increasing awareness of the significant benefits ofPHC to key players in healthcare (payers, physicians, regulators,patients), new possibilities in molecular diagnostics and inparticular very recent regulatory and payer decisions, most notablyaround products where DxS' portfolio plays a key role, haveaccelerated the trend towards a more integrated use of diagnosticinformation to guide therapy.While most current companion diagnostics are "retrofitted"diagnostics, i.e. diagnostics that were retroactively added toapproved drugs to improve outcomes, the new generation of companiondiagnostics is being developed together with drugs to predictresponses of patient populations to the drug treatment and increaseits efficacy and safety. By testing for specific genetic variationsrelated to certain biomarkers, health professionals can customizetheir therapies and avoid unnecessary or harmful treatments. Theconcept of personalized healthcare plays an increasingly importantrole in treatment decisions in clinical areas such as cardiovascularand neurological diseases and - most prominently - in cancer. Thereare 28 companion diagnostic tests for valid genomic biomarkersidentified by the FDA in the context of FDA-approved drug labels.According to industry reports, the market for personalized healthcaregrew annually at 24% over the last decade, amounting to US$ 13billion in 2008.About QIAGEN:QIAGEN N.V., a Netherlands holding company, is theleading global provider of sample and assay technologies. Sampletechnologies are used to isolate and process DNA, RNA and proteinsfrom biological samples such as blood or tissue. Assay technologiesare used to make such isolated biomolecules visible. QIAGEN hasdeveloped and markets more than 500 sample and assay products as wellas automated solutions for such consumables. The company provides itsproducts to molecular diagnostics laboratories, academic researchers,pharmaceutical and biotechnology companies, and appliedtesting customers for purposes such as forensics, animal or foodtesting and pharmaceutical process control. QIAGEN's assaytechnologies include one of the broadest panels of moleculardiagnostic tests available worldwide. This panel includes the digeneHPV Test, which is regarded as a "gold standard" in testing forhigh-risk types of human papillomavirus (HPV), the primary cause ofcervical cancer, as well as a broad suite of solutions for infectiousdisease testing and companion diagnostics. QIAGEN employs more than3,200 people in over 30 locations worldwide. Further informationabout QIAGEN can be found at http://www.qiagen.com/.About DxS:DxS is a personalized healthcare company providing moleculardiagnostics to aid doctors and drug companies in selecting safe andeffective therapies for patients based on their molecular profiles(Companion diagnostics). Headquartered in Manchester, UK, the companyemploys approximately 80 employees in two countries, most of them inthe UK. More information about DxS can be found atwww.DxSdiagnostics.com.SAFE HARBOR STATEMENTStatements contained in this release that are not historical factsare forward-looking statements, including statements about ourproducts, markets, strategy and operating results. Such statementsare based on current expectations that involve risks anduncertainties including, but not limited to, those associated with:management of growth and international operations (including currencyfluctuations and logistics), variability of our operating results,commercial development of our markets (including applied testing,clinical and academic research, proteomics, women's health/HPVtesting, molecular diagnostics, personalized healthcare and companiondiagnostics), our relationships with customers, suppliers andstrategic partners, competition, changes in technology, fluctuationsin demand, regulatory requirements, identifying, developing andproducing integrated products differentiated from our competitors'products, market acceptance of our products, and integration ofacquired technologies and businesses. For further information, referto our filings with the SEC, including our latest Form 20-F.Information in this release is as of the date of the release, and weundertake no duty to update this information unless required by law. # # #Contacts:Dr. Solveigh Mähler Dr. Thomas TheuringerDirector Investor Relations Associate Director PublicQIAGEN N.V. Relations+49 2103 29 11710 QIAGEN GmbHe-mail: +49 2103 29 11826solveigh.maehler(at)qiagen.com email: thomas.theuringer(at)qiagen.comAlbert F. FleuryDirector Corporate Finance and InvestorRelations North AmericaQIAGEN N.V.+1 301 944 7028e-mail: albert.fleury(at)qiagen.com --- End of Message ---Qiagen N.V.Spoorstraat 50 KJ Venlo NetherlandsWKN: 901626; ISIN: NL0000240000; Index: HDAX, MIDCAP, Prime All Share, TECH All Share, TecDAX;Listed: Prime Standard in Frankfurter Wertpapierbörse, Freiverkehr in Börse Berlin, Freiverkehr in Börse Düsseldorf, Freiverkehr in Hanseatische Wertpapierbörse zu Hamburg, Freiverkehr in Niedersächsische Börse zu Hannover, Freiverkehr in Bayerische Börse München, Freiverkehr in Börse Stuttgart;
Datum: 22.09.2009 - 22:05 Uhr
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