Affymetrix Acquisition Deepens and Complements Thermo Fisher’s Existing Product Groups in Clinical Molecular Testing, Translational Research, Flow Cytometry and Applied Testing

Affymetrix Acquisition Deepens and Complements Thermo Fisher’s Existing Product Groups in Clinical Molecular Testing, Translational Research, Flow Cytometry and Applied Testing

Kalorama Information offers additional analysis of the markets discussed below with an upcoming title on clinical and research microarrays as well as published reports including The Market for Prenatal, Newborn and Carrier Genetic Testing, The World Market for Cancer Diagnostics, 6th Ed., Proteomics Research Markets, The World Market for Flow Cytometry in IVD Applications, andThe World Market for Veterinary Diagnostics.

Thermo Fisher Scientific’s reach in the global life sciences market will extend even further with the recently announced acquisition of Affymetrix. The deal bolsters multiple businesses under the conglomerate with additional product offerings in diagnostics, biotechnology, pharmaceuticals, life science research, and applied testing. Affymetrix was purchased for approximately $1.3 billion and had total revenue of $349 million in 2014. Affymetrix’s total revenue was up roughly 5% through three quarters of 2015. Thermo Fisher plans to integrate the company into its Life Sciences Solutions segment, a $4 billion business segment created with the previous acquisition of Life Technologies in February 2014.

Affymetrix’s major product groups will integrate well into Thermo Fisher Scientific’s existing businesses and also introduce the parent company into promising expansion markets.

Affymetrix is a diversified supplier of life science and clinical diagnostics products with its core expertise in microarrays. The company’s primary markets include the following:

  • Molecular diagnostics - Affymetrix has contributed to the development of third-party microarray assays an offers its own microarray assays, including several that are FDA-cleared
  • Translational medicine - the company offers several array platforms for life science research with the objective of introducing clinical products such as diagnostics and pharmaceuticals
  • Basic research - research activities that serve as the foundation for translational research and the eventual introduction of products to clinical and industrial markets; major clients include academia, government and private research foundations
  • Flow cytometry - the technology is used in basic and clinical research as well as in clinical diagnostics for the counting and characterization of particles, molecule analytes and cells often labeled by antibodies; business created by Affymetrix’s 2011 acquisition of eBioscience
  • Applied markets - genotyping and expression arrays used primarily in agricultural biology (AgBio) for the selection and breeding of livestock and crops based on optimal traits

Affymetrix’s major product groups outlined above will integrate well into Thermo Fisher Scientific’s existing businesses and also introduce the parent company into promising expansion markets.

Microarrays in Clinical Molecular Diagnostics

Affymetrix is a leader in the global microarray market that has been reshaped by rising competition from next-generation sequencing (NGS) in a key application area of gene expression studies. In the past several years, the microarray industry saw the notable exit of Roche with its shuttering of its NimbleGen microarray operation that left only Affymetrix, Agilent and Illumina as major suppliers. Declining market prospects were countered, however, by the rising application of microarrays in oncology and reproductive health.

Likely a key consideration for Thermo Fisher was Affymetrix’s portfolio of FDA-cleared microarray products for use both directly as clinical tests or templates for third-party test development. Affymetrix’s Gene Profiling Array platform uses FDA-cleared and CE-marked Gene Profiling Reagents intended for use in the development of clinical tests.

Other Affymetrix products such as GeneTitan and GeneChip instruments and array consumables are used by clinical testing service and lab clients. In 2014, Roche’s Ariosa Diagonstics signed a multi-year supply agreement with Affymetrix for GeneTitan instruments and consumables as a basis for the lab company’s non-invasive prenatal tests (NIPTs).

Reproductive health has been highly targeted by IVD companies in recent years with the introduction of assays for vertically transmissible infectious diseases such as GBS and HSV and prenatal screening.

In addition to its partnership with Ariosa Diagnostics, Affymetrix is active in reproductive health through its CytoScan array kits used by labs for NIPT services, in addition to other clinical testing services. Reproductive health has been highly targeted by IVD companies in recent years with the introduction of assays for vertically transmissible infectious diseases such as GBS and HSV and prenatal screening. The multi-billion market for prenatal, newborn and carrier genetic testing has attracted significant investment from IVD heavyweights such as Roche, Perkin Elmer and, most recently, Thermo Fisher.

Affymetrix also introduced the CytoScan Dx microarray assay in 2011 (FDA-cleared in 2014) for postnatal diagnosis of developmental delay, intellectual disabilities, congenital abnormalities and dysmorphic features. The CytoScan Dx product will join Thermo Fisher’s own immunodiagnostic-based maternal screening products and Life Technologies sequencing platforms that are finding heavy application in prenatal testing within the Chinese market.

Microarrays have performed well in cancer testing markets across from lower throughput methods such as FISH and PCR and sample-sensitive NGS methods.

The CytoScan platform also finds broad application outside of reproductive health with its ability to perform copy number analysis across the entire genome from a patient blood sample. Copy number variations represent risk factors for the development of various health disorders. The related OncoScan product from Affymetrix performs whole-genome copy number analysis from tissue (FFPE) samples, targeting cancer risks. Microarrays have performed well in cancer testing markets across from lower throughput methods such as FISH and PCR and sample-sensitive NGS methods. OncoScan and other microarray-based whole-genome analysis products from Affymetrix are expected to complement Thermo Fisher’s clinical NGS product line led by the FDA-cleared Ion PGM Dx instrument.

Basic and Translational Research

The majority of Affymetrix’s revenue comes from non-clinical end users such as academia, government, private research foundations, and industries. Aside from applied or operational testing in industry, non-clinical sales for Affymetrix predominate in basic and translational research. In the area of basic research, Affymetrix is a leading supplier of genotyping products to biobanks and biobanking initiatives such as in the United Kingdom.

Translational research is the traditional revenue engine for Affymetrix. Microarrays play a critical role in the translational pipeline activities of discovery, verification and validation crucial to the integration of biomarkers into diagnostics and development of pharmaceuticals from drug targets. Various probes can be synthesized on microarray chips including RNA, DNA and antibodies used to study RNA populations (gene expression), gene sequences (DNA), transcription factors, and protein populations.

The acquisition of Affymetrix provides Thermo Fisher near comprehensive coverage in translational research in terms of the layers of systems biology (genome, transcriptome, proteome).

The acquisition of Affymetrix provides Thermo Fisher near comprehensive coverage in translational research in terms of the layers of systems biology (genome, transcriptome, proteome). The life science giant is already a leader in the area of proteomics research with its mass spectrometry (MS) systems. Affymetrix contributes further to Thermo Fisher’s translational research solutions in the areas of transcriptomics (RNA), genomics (DNA), and proteomics (proteins including enzymes). The addition of Affymetrix’s eBioscience business will also bring ProcartaPlex Multiplex Immunoassays for the detection of hundreds of secreted protein analytes on one assay.

Flow Cytometry

Flow cytometry is a uniquely powerful tool with applications in both clinical diagnostics and life science research. As a life science and biotechnology conglomerate, Thermo Fisher already offers clients a number of antibodies, other reagents and assay kits for flow cytometry studies. The nearly $100 million eBioscience business under Affymetrix is a leader in flow cytometry reagents and other immunoassay reagents, offering its new parent company greater exposure to high-growth market areas such as single-cell biology and flow cancer testing.

Affymetrix reported in early 2015 that eBioscience was the second-leading provider of flow cytometry reagents for research markets. The impact of the Affymetrix acquisition for Thermo Fisher also extends to clinical flow cytometry, particularly flow cancer testing - one of the leading technology segments of the global cancer diagnostics market.

Agricultural Biology (AgBio)

Thermo Fisher Scientific is the market leader in terms of sales in the food animal segment of the global veterinary diagnostics market. The conglomerate has assembled a portfolio of veterinary  test products through its acquisitions of Finnzymes (2010), Life Technologies (2013), and, most recently, Prionics in 2014. Life Technologies (including subsidiary LSI) and Prionics established Thermo Fisher Scientific as a leader in molecular and immunoassay tests for veterinary infectious diseases. Thermo Fisher’s latest acquisition of Affymetrix will allow it to comprehensively address biotechnology needs in agriculture with microarrays for crop and livestock genotyping and trait analysis. In early 2014, Affymetrix estimated the genotyping market opportunity in agricultural biology at approximately $500 million.