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Molecular Diagnostics Company Acquired in $1.8B Deal

Investment graphic

(Gerd Altmann, Pixabay)

15 Mar. 2021. GenMark Diagnostics, a developer of diagnostics systems using genomic analysis, was acquired by drug maker Roche in a deal valued at $1.8 billion. Roche, based on Basel, Switzerland, is most interested in GenMark’s molecular tests for infectious diseases, which Roche expects to integrate into its Roche Diagnostics division.

GenMark Diagnostics in Carlsbad, California provides rapid on-site diagnostic tests that analyze specimen samples, such as blood, from patients. The company’s technology is based on research in the 1990s by its scientific founder Jon Faiz Kayyem at California Institute of Technology that devised a sensor for electronic detection of nucleic acids in a single-use chip device. The technology has evolved into disposable microfluidic, or lab-on-a-chip, cartridges holding the samples, with electronic sensors to detect nucleic acids in the specimens. Kayyem is still a scientific adviser to the company.

Diagnostics for multiple diseases with common symptoms

Many of GenMark’s tests are designed to diagnose infectious diseases. Its diagnostics include a single syndromic panel to test for 14 different respiratory viruses, which can help pinpoint the cause of symptoms common to a range of disorders. The company also has molecular diagnostics specifically for SARS-CoV-2 and hepatitis C viruses, as well as genetic tests for inherited diseases cystic fibrosis and thrombophilia, an imbalance in blood-clotting factors, and sensitivity to adverse reactions to blood-thinning drugs. A separate set of panels tests for blood pathogens, including those leading to sepsis.

GenMark’s infectious disease tests appear to be driving Roche’s acquisition. “Acquiring GenMark Diagnostics,” says Thomas Schinecker, CEO of Roche Diagnostics in a statement, “will broaden our molecular diagnostics portfolio to include solutions that can provide lifesaving information quickly to patients and their health care providers in the fight against infectious diseases.” Schinecker adds, “Their proven expertise in syndromic panel testing provides faster targeted therapeutic intervention, resulting in improved patient outcomes and reduced hospital stays, and will contribute to Roche’s commitment to helping control infectious diseases and antibiotic resistance.”

Under the agreement, Roche is acquiring all outstanding GenMark Diagnostics stock at $24.05 a share. The deal pays GenMark shareholders in cash a premium of 30 percent over the stock’s closing price of $18.50 on Friday, 12 Mar. GenMark is expected to continue operating at its current location in Carlsbad, California.

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