NEW YORK (GenomeWeb News) — General Electric late yesterday said it plans to acquire two of Abbott Technologies’ diagnostics businesses for $8.13 billion in cash, and will leave alone the company’s molecular diagnostic unit.
The acquisition includes Abbott’s in vitro diagnostics and point-of-care divisions and represents another rung in GE Healthcare’s goal of creating a business that combines in vitro and in vivo technologies to diagnose diseases.
The news confirms and clarifies news reports yesterday claiming the deal was imminent.
With this deal, GE Healthcare adds two more components to its growing diagnostics business. CEO Jeffrey Immelt said the purchase is “consistent with GE’s strategy” and said that Abbott’s foothold in the “growing diagnostics field is aligned with our objective to deliver a comprehensive array of diagnostic products around the world.”
GE said it plans to bundle early diagnosis and IT to create an “early health model” that focuses on catching diseases before symptoms develop.
For Abbott, which will also retain its diabetes care segment, the divestitures underscores the firm’s intention to streamline and maintain emphasis on its molecular brand.
For example, last month, Abbott said it intends to launch new tests in Europe based on fluorescent in situ hybridization that will identify chromosomal abnormalities linked to leukemia. These CE-marked DNA probe diagnostics could in the future be used in a variety of applications in cancer and genetic testing, the company said.
Saying that the playing field for lab diagnostics has “changed considerably in the last decade,” Abbott CEO Miles White said he expects that the in vitro and point-of-care businesses will help GE Healthcare position itself in a field that is “increasingly driven by automation, system integration, and a host of skills that GE can offer.”
While the deal is still subject to standard conditions and regulatory approval, both companies’ boards have approved the acquisition, the companies said.
Abbott’s in vitro and point of care diagnostics are expected to have generated around $2.7 billion in revenues in 2006, the companies said.