Roche Forays into Syndromic Panel Testing by Placing $1.8 Billion Bet on GenMark Acquisition

March 15th, 2021 – When shares of GenMark Diagnostics surged to a record high in early February, Bloomberg reported that several prospective buyers were approaching the California-based company. Today, those reports were confirmed true, and Roche turned out to be the successful pursuant.

The Swiss pharma giant has entered a definitive merger agreement to acquire GenMark in an all-cash deal for $24.05 per share, which amounts to a total of $1.8 billion. Roche is paying a whopping 43% premium on GenMark’s unaffected closing stock price on February 10th, before the scoop about the acquisition emerged. This is Roche’s biggest acquisition deal since it acquired gene therapy company Spark Therapeutics in 2016 for $4 billion.

In response to the news, GenMark’s (GNMK) stocks soared from Friday’s closing price of $18.5 per share to around $24 and remained there or thereabouts until close.

GenMark’s Assets

GenMark is a diagnostics company that offers multiplex molecular diagnostic solutions to detect biomarkers and pathogens from blood samples. Currently, it provides testing panels and analyzers for identifying inherited blood disorders such as Thrombophilia and cystic fibrosis and pathogens such as HCV and respiratory viruses, including SARS-CoV-2. Recently, it also submitted the eSensor SARS-CoV-2 test, a qualitative multiplex assay that was recognized as the most sensitive Respiratory Viral Panel in the market.

Roche expects that GenMark’s panel testing portfolio will complement its current molecular diagnostics portfolio, and it can offer a global reach for GenMark’s products through its wide network.

“Acquiring GenMark Diagnostics will broaden our molecular diagnostics portfolio to include solutions that can provide lifesaving information quickly to patients and their healthcare providers in the fight against infectious diseases,” said Thomas Schinecker, CEO of Roche Diagnostics.

“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. The rapid identification of bloodstream infections and the detection of antimicrobial resistance genes are more essential than ever for hospitals and their patients.”

GenMark recently announced hitting $50.1 million in revenue in the fourth quarter of 2020, which is an 84% increase over the fourth quarter of 2019. With this acquisition, Roche could capitalize on the growing success of GenMark’s products, especially its ePlex® system, which has raked in high revenue over the years. In the fourth quarter of 2020, it netted $45.4 million, registering a rise of 138 percent compared to the previous year’s Q4 sales.

“As a part of Roche, we can accelerate our mission to enable rapid diagnosis of infectious disease to improve patient outcomes. Together with Roche’s diagnostics healthcare solutions, we will be able to provide a full suite of molecular diagnostic solutions to customers around the world,” said Scott Mendel, CEO of GenMark Diagnostics.

The deal is expected to close in the second quarter of 2021, and Roche said, GenMark will continue to operate from its current Carlsbad, California location post the transaction.

Related Article: Thermo Fisher Expands Portfolio by Acquiring COVID-19 Diagnostic Company

Related posts:

Expedited Approval of Vitrakvi® Marks Many Firsts in Cancer Therapy Roche to Acquire Long-Time Partner to Advance Molecular Diagnostics for Infectious Diseases Roche Gets Shareholders Nod to Repurchase $21B Equity Stake Held By Novartis Roche Buys Good Therapeutics For $250 Million Upfront, Obtains Immune Stimulating Antibody Conjugate Program

Author

Rajaneesh K. Gopinath