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PerkinElmer Reiterates M&A, Alliance Plans; Cell Screening Market a Key Growth Area

PerkinElmer is "highly interested" in investing in its cell-based assay and reagent businesses, and will likely attempt to acquire core competencies in these areas through acquisitions, partnerships, or both in the coming year, a PerkinElmer official told BioCommerce Week's sister publication Cell-Based Assay News at the Society for Biomolecular Screening conference in Geneva last week.

By taking this step, PerkinElmer could diversify its offerings and eat into Molecular Devices' massive share of the cell-population assays and ion-channel screening market by combining new reagents with its newly launched LumiLux instrument and existing CellLux and UltraView instruments.

Deb Brusini, business unit leader for drug discovery within PerkinElmer's Life and Analytical Sciences division, said that in particular the company will be looking to add reagents such as advanced photoproteins to better enable its LumiLux high-throughput live-cell ion-channel screening instrument, which the company launched at the meeting.

In addition, PerkinElmer is looking to develop or acquire optimized cell lines to enable "mix-and-measure"-type assays on both its CellLux and LumiLux instruments. Farther in the future, the company also expects to acquire or develop optimized reagents for conducting FRAP and FRET analysis on its UltraView confocal reader, Brusini said.

"From an instrumentation standpoint for HCS, it's not that PerkinElmer would say it's a bad investment to buy an HCS instrument, but we would say that the enabler is not the imager."

PerkinElmer, a company known for its high-precision instrumentation platforms, has been lagging behind in the area of cell-based assays — in particular live-cell analyses — which, because of its increasing popularity among drug makers, has caught the attention of its biggest rivals. To be sure, PerkinElmer is one of the better-known names in one specific area of cell-based assay technologies — cAMP assays — but these are not true kinetic live-cell assays, despite the fact that they also command a large market in the pharmaceutical industry.

"We'd like to concentrate on the ion channel area with the CellLux, and the whole GPCR screening area with the LumiLux," Brusini said. "It's not that we think HCS is not promising, we just … see a lot of players in there."

Several firms in the BCW Index, including Molecular Devices, GE Healthcare, and Beckman Coulter, already have HCS plays. Fisher Scientific recently joined that group with its $49 million purchase of Cellomics (see BioCommerce Week 9/15/2005).

"From an instrumentation standpoint for HCS, it's not that PerkinElmer would say it's a bad investment to buy an HCS instrument, but we would say that the enabler is not the imager," Brusini said. "There are plenty of good [HCS] instruments out there now. The enabler is going to be a real reagent menu that these folks can use day in and day out."

Although PerkinElmer already has internal programs in place to address the development of new reagents, "it's very hard to get that internal capability on your own," Brusini said. "So, in the future, what we'll be doing a lot of is acquiring competency in this area, as well as looking for technology to acquire in this area. The things that we'll be interested in will be anything that will allow these live-cell assays to be done more effectively."

Possible acquisition targets with core competencies and key technologies in this area include Danish biotech firm BioImage, with which PerkinElmer has already collaborated scientifically, and Italian biotech firm Axxam. Brusini stressed that PerkinElmer is not necessarily interested in acquiring those particular companies.

She also noted that Invitrogen would be an example of a company that would be attractive for a partnership in this area.

[Editor’s Note: As this issue went to press, PerkinElmer and Invitrogen announced a co-marketing pact, combining Invitrogen’s Voltage Sensor Probes ion channel reagents with PerkinElmer’s CellLux platform. More information on the alliance will appear in next week’s issue of BioCommerce Week.]

Challenging Molecular Devices?

PerkinElmer's biggest competitor in cell-population assays for GPCR and ion-channel screening is Molecular Devices, whose FLIPR platform is widely used. A few other companies have begun making strides in this area as well, such as Hamamatsu, with its FDSS 6000 plate reader.

Although exact percentages are not known, Molecular Devices enjoys a firm hold on this market with FLIPR, and is considered the gold standard. According to a 2004 report by independent consultancy HTSTec, the preferred assay technology for studying GPCR activation was fluorescence-based calcium flux assays, with cAMP assays the second choice. Furthermore, the report said that the preferred industry detection technology was Molecular Devices' FLIPR.

Recognizing this, PerkinElmer hopes to challenge Molecular Devices' position in the market by combining new reagents with its newly launched LumiLux instrument.

"We do think the LumiLux can drive a paradigm shift in the way people are doing their calcium screening assays, which is predominantly with FLIPR," Brusini said. "That's been the standard for many years. Is there a better way to measure calcium flux? We think that there is.

"The main thing here is the return on investment that you get by being able to completely productize cellular screening and make it sort of a mix-and-measure biochemical assay," she said. "This is really going to drive big pharma to think of a different way of doing calcium screening. If you combine it with the right kind of reagent technology, there are certain things that you just completely illuminate, and it allows you to use suspension cells. That makes it just like a mix-and-measure assay, and the cells become more like a regular reagent."

Because PerkinElmer launched the LumiLux last week, only time will tell if Brusini's vision of a "paradigm shift" in calcium screening assays will be realized. However, if and when any reagent acquisition does occur, it should help the company establish a firmer foothold.

"We think that in a couple or three years, people will be doing calcium screening the way people do things with a ViewLux today, the way Kalypsys runs billions of endpoint reporter gene and biochemical assays," Brusini said. "They'll be doing the same thing with luminescence. So we see this as a very important step to gaining credibility in this area."

"The things that we'll be interested in will be anything that will allow these live-cell assays to be done more effectively."

Acquisitions a Possibility

PerkinElmer has been relatively quiet on the acquisition front for the last few years compared with some of its BCW Index competitors, focusing instead on its existing offerings in mass spectrometry, microarray scanners, and high-throughput screening.

It stayed out of the M&A market between its 2001 acquisition of Packard Bioscience for $650 million and its $15 million purchase earlier this year of Elcos, a German-based manufacturer of custom light-emitting diode-based products for biomedical and industrial applications, largely due to a mountain of debt that it has been paying down over the past few years.

But PerkinElmer's plans to acquire other technologies or companies is not necessarily surprising.

Greg Summe, the firm's CEO, said earlier this year that the company was shifting its focus to higher-growth applications and would pursue selective technology acquisitions and partnerships (see BioCommerce Week 5/26/2005).

And PE spokesman Dan Sutherby told BioCommerce Week in July, "We're not looking to do a big capacity deal. Just small technology tuck-ins." He said acquisitions would likely be in the areas of biomarkers, genetic screening products, and medical imaging (see BioCommerce Week 7/14/2005).

The firm recently laid off an undisclosed number of employees and shifted its sales focus from Europe to Asia (see BioCommerce Week 7/14/2005). Sutherby said that in combination with the shift, PerkinElmer intended to increase its investment in its genetic screening, biomarker, and service businesses in Asia, with a focus on expanding in China and India.

— Edward Winnick ([email protected])
and Ben Butkus ([email protected])

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