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ABI s Lombardi Cites Continued Growth in NIH and Pharma Spending As Good News for Instrument Sales

NEW YORK, Nov. 28 — Despite current economic conditions, Applied Biosystems remains optimistic about prospects for instrument sales, according to Stephen Lombardi, the company's vice president of applications and products. Speaking to a small early-morning audience of industry investors and analysts at the Robertson Stephens Medical Conference here on Wednesday, Lombardi said that NIH and pharma R&D spending continue to grow at rates in the range of 13 to 14 percent, and that’s good news for ABI. 

Within the US pharma industry, Lombardi said ABI is most encouraged by growth in “plant and equipment R&D expenditures,” which he estimated to be growing at 24.6 percent.

Lombardi, who claimed that at $181 million Applied Biosystems’ R&D budget is the “largest in the industry,” explained that ABI’s strategy is to hone the speed and accuracy of its instruments in order to drive down cost-per-assay, and thereby spur new uses for the technologies. 

Lombardi highlighted three new products that he said would poise ABI to “take advantge of and capitalize on the human genome reference sequence”: the Prism 3100 for DNA analysis by electrophoresis, the Prism 7900 for DNA analysis by real-time PCR, and two mass spectrometry instruments — the API 4000 mass spectrometer, to be released “at the end of the next quarter,” and the Maldi TOF/TOF, which Lombardi said would be commercially available around March 2002. 

In addition, Lombardi said the company is “excited” about a collaboration with Illumina in which it will develop SNP microarrays for high volume genotyping.

Lombardi said that 50 percent of ABI’s $1.6 billion in revenues in FY01 came from instrument sales, and 37 percent from consumables. Half of those revenues came from outside the US, and more than half came from basic research customers, he said. 

Lombardi formerly served as vice president for ABI’s field operations in the Americas and was appointed to his current post in April to oversee the marketing of the company’s product lines and lead a new service aspect. He said that “a major change” in management structure at ABI over the last eight months has been designed, in part, to improve attention to customer service.


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