Luminex Acquisition of Nanosphere Continues Trend of Investment in Decentralized Molecular Testing

Luminex Acquisition of Nanosphere Continues Trend of Investment in Decentralized Molecular Testing

This blog post reviews the recent history of acquisitions and investment in the area of decentralized molecular diagnostics. Kalorama Information’sThe Market and Potential for Molecular Point of Care Diagnosticsprovides the current market, projected future sales and total available markets in 2020 for molecular POC diagnostics for flu, strep A, RSV, CT/NG, group B strep (GBS), HPV, HSV, vaginitis, HIV, TB, hepatitis, malaria and many other disease areas.

Make sure to visit our Point of Care Testing page, Kalorama's all-in-one resource covering the POC testing market. 

On May 16, Luminex Corporation announced a definitive agreement with Nanosphere, Inc. to acquire the latter for approximately $58 million. On May 23, Luminex raised its offer from $1.35 per Nanosphere share to $1.70 in response to an unsolicited third-party offer of $1.50 per share. The total adjusted price for Nanosphere became >$90 million including retirement of Nanosphere debt. The acquisition will broaden Luminex’s addressable market in clinical molecular testing, adding platform capabilities and clients outside of the Luminex ARIES platform and xTAG panels.  The Nanosphere Verigene and Verigene Flex platforms cater to the hospital market for automated molecular testing platforms, and could lead to opportunities in other decentralized markets for molecular testing (outside of centralized clinical labs or reference labs). Luminex’s acquisition of Nanosphere continues a string of company and technology acquisitions that have shaped the early molecular POC diagnostics industry.

Luminex’s latest acquisition is in the same vein of others by major IVD companies in recent years. Although not directly addressing the molecular POC diagnostics space - the Verigene system appeals primarily to hospital microbiology labs - Nanosphere and its platform have key features for decentralized molecular testing: microfluidic test cartridges for integrated test performance, automated results detection, rapid sample-to-results turnaround time (<3 hours) and relevant test menu (respiratory infections, enteric, pharmacogenomics). The Verigene Plex in development promises fully integrated test performance from sample to answer. Past acquisitions of molecular diagnostics technology and specialist companies by IVD companies addressed these same capabilities and platform features:

  • Alere / TwistDx (2010) - Alere acquired recombinase polymerase amplification (RPA) as an isothermal amplification option for its molecular POC platform, the Alere i. Isothermal amplification is a common option in molecular POC platforms, next to PCR, due to its rapidity of results and selected cost advantages.
  • Alere / Ionian Technologies (2010) - Alere acquired the company and its isothermal nicking enzyme amplification reaction (NEAR) method. Now featured in the Alere i, NEAR offers improvements over PCR in terms of equipment requirements, energy consumption (no thermal cycling), and comparable, if not superior, sensitivity and reaction time. In the case of NEAR, amplification can be completed in as little as 5 to 10 minutes. Sample preparation is also relatively simple with NEAR.
  • DxNA / PathoGene (2013) - DxNA acquired PathoGene and its assays to form the initial menu of the GeneSTAT platform. PathoGene assays for S. aureus/MRSA, Valley Fever and influenza are relevant to decentralized infectious disease testing applications.
  • Quidel / BioHelix (2013) - Quidel acquired BioHelix Corporation and integrated the company’s isothermal Helicase Dependent Amplification (HDA) technology into its AmpliVue and Solana platforms for moderate complexity molecular testing. The amplification method is distinguished from other market-available isothermal methods by its requirement of only two primers. The versatile method can be used to amplify either DNA or RNA. The mechanisms of HDA are similar to PCR and allow some sharing of platforms and protocols.
  • bioMérieux / BioFire Diagnostics (2014) - Infectious disease diagnostics heavyweight bioMérieux acquired BioFire Diagnostics for its flagship FilmArray system. The system enables rapid molecular testing in hospital labs using integrated pouches that perform microarray qPCR amplification through results detection. Multiplex panels run on the FilmArray system use two stages of PCR amplification or two sets of primers to improve multiplex test sensitivity. FilmArray sales have quadrupled from roughly $40 million in 2013 to over $160 million in 2015.
  • Roche / IQuum (2014) - Rivaling Alere’s contribution to molecular POC testing, Roche was able to launch the cobas Liat analyzer and its CLIA-waived molecular tests following the acquisition of IQuum Diagnostics and its Laboratory-in-a-tube (Liat) platform. The system uses pre-packaged flexible reagent test tubes with breakable seals and moveable clamps that initiate system-integrated test procedure steps and control fluid direction. The rapid PCR test performed on the cobas Liat provides results in as little as 20 minutes.
  • ERBA Diagnostics / Lumora (2015) - ERBA Molecular was created with the acquisition of UK molecular diagnostics specialist Lumora. The company developed several technologies relevant to isothermal amplification testing workflows including the novel bioluminescent assay in real time (BART) reporter system for results detection and heat elution (HE) for sample preparation. The two methods have been used with LAMP amplification for HE-LAMP-BART workflow testing. Lumora also developed STEMS or stem primer technology that can significantly accelerate the LAMP amplification process. ERBA Molecular plans to develop a CLIA-waived molecular test device based on its proprietary sample prep-LAMP-BART workflow.
  • Abbott Laboratories / Alere (2016) - Abbott Laboratories announced an agreement with Alere in February 2016 to acquire the company and vault Abbott Diagnostics to the leading position in the global POC diagnostics market. The Alere i platform factored into the appeal of acquiring Alere.

In The Market and Potential for Molecular Point of Care Diagnostics, Kalorama Information notes not only the sequence of deals that established Roche, Alere, bioMérieux and others in the diagnostics market for decentralized molecular testing, but also investment trends related to decentralized molecular diagnostics. In addition to the sums spent on acquisition deals, over $300 million was raised in both 2014 and 2015 by companies active in decentralized molecular diagnostics through venture capital fundraising (seed and series A, B and C financing) and public offerings. The previous five years (2009-2013) saw total investment of over $650 million from the same activities.