NEW YORK (GenomeWeb News) – The Eurofins Group, an international bioanalytical testing provider, said this week that it has formed a genomics business unit called Eurofins Genomics that will consolidate the operations of Operon Biotechnologies, which it recently acquired, and two existing Eurofins subsidiaries.
As a result, Eurofins Genomics is planning to close two European facilities and one US site, GenomeWeb Daily News has learned.
The closures are part of Eurofins Genomics’ plan to consolidate and align assets after its recent purchase of Operon Biotechnologies, said Jutta Huber, head of marketing at Eurofins’ MWG Biotech subsidiary.
Eurofins Group said two weeks ago that it had acquired three genomics companies with facilities in the US, Germany, and in Japan, although the company did not disclose the names of the companies at the time.
Patrick Weiss, Operon’s managing director, confirmed today that the acquisitions comprised Operon, based in Huntsville, Ala., and two of its subsidiaries in Köln, Germany, and Tokyo, Japan.
Weiss has been tapped to serve as CEO of Eurofins Genomics, a joint venture between three Eurofins subsidiaries: Operon, MWG Biotech, and Medigenomix.
MWG Biotech is based in Munich, but it had a facility in Highpoint, NC, that will be now closed. Those operations will move to Operon’s headquarters in Huntsville.
In addition, MWG Biotech may lay off some of its staff as it consolidates resources regionally, Huber said, though she said it was too early to provide further details.
Operon’s Köln facility will, in turn, be closed and moved to MWG’s headquarters in Ebersberg, Germany.
Eurofins’ sequencing services subsidiary Medigenomix, which is based in Munich, also will relocate to Ebersberg.
Huber said that the consolidation is partly in response to a competitive but, in terms of organic growth, “not very dynamic” oligonucleotide synthesis market.
Operon’s Weiss said in a statement that “overcapacity in the market has put a lot of pressure on oligonucleotide synthesis service suppliers,” and that “very few companies are able to keep up with the level of investment and innovation needed to meet the market demand.”
“It is a very competitive market,” Weiss told GWDN, “[but] with every competitor that we take out there is less competition.”
Weiss said Operon expects growth in the oligo and custom DNA markets, but noted that the company is under competitive pressure to keep prices low.
Weiss added that there may be more restructuring to come, but could not anticipate whether that would mean trimming staff, more relocations, or more consolidation with the Eurofins Group’s other subsidiaries.