Though it has been steadily adding an array of businesses to bolster its molecular biology platforms over the past few years, Fisher Scientific has not made a move to integrate those pieces.
Most recently, Fisher's decision to acquire high-content screening pioneer Cellomics and retain it as a stand-alone business is noteworthy because the market segment in which Fisher has been building itself to compete will likely be defined by those companies that can successfully integrate their multivariate technology platforms into cohesive and cost-effective bundles.
Fisher, known primarily for its lab equipment and sizable distribution network, completed the acquisition of high-content screening pioneer Cellomics on Aug. 31. The $49 million purchase gives Fisher a market leader in the emerging cell screening space and enables Cellomics to work with its Dharmacon RNAi business and compete with other multi-platform molecular biology tool providers, including GE Healthcare, Molecular Devices, Beckman Coulter, and Becton Dickinson.
Matt Friel, senior vice president of corporate development for Fisher Scientific, told BioCommerce Week sister publication Cell-Based Assay News that Cellomics will "continue to function as an ongoing business unit within Fisher, and will take advantage of the reagent capabilities of the other businesses as opposed to being consolidated into them."
"At this point, the perspective on [Cellomics] is that we bought it as a new technology, but we did not buy it as a consolidation play of any sort. We would expect to leverage all the resources that Cellomics has in-house now."
He added, "At this point, the perspective on the business is that we bought it as a new technology, but we did not buy it as a consolidation play of any sort. We would expect to leverage all the resources that Cellomics has in-house now."
The question now facing the diversified research products firm is how it will sell its variety of complementary products and technologies — and compete against firms that are offering similar integrated packages of molecular biology tools — without integrating them. This task has been charged to Bill Marshall, vice president of technology and business development for Fisher Biosciences, who previously was executive vice president of research and operations at Dharmacon, which Fisher acquired in February 2004. Marshall will now take on a broader role in his new Fisher Biosciences position.
Though integrating its variety of molecular biology tools seems unlikely right now, Fisher intends to take advantage of its complementary businesses and technologies, particularly the RNAi expertise of its Dharmacon unit, to grow Cellomics' business. "There are some real potential utilities … using the high-content screening capabilities to monitor cellular states in response to inhibition of genes," Marshall told CBA News.
The company also believes Cellomics is a fit with some of its other bioscience offerings, such as HyClone's cell-culture products, Pierce Biotechnology's protein science and labware products, and AbGene's qPCR capabilities. In addition to these businesses, Fisher acquired Swedish protein reagent supplier Perbio for more than $700 million in cash two years ago.
It remains to be seen if Fisher will continue acquiring technologies or companies, and what types of platforms it would add to its growing molecular biology tools portfolio. Vice Chair Paul Meister may have dropped a hint at the Banc of America Securities Health Care Conference in May when he said that the firm would consider higher-growth consumable plays in the molecular biology tools field as potential acquisitions. He said Fisher expects $400 million in cash flow this year, which would ensure the company is flexible for any potential acquisition targets that come its way.
Fisher officials did not respond to questions from BioCommerce Week by press time.
Growing the Cellomics Business
Fisher believes Cellomics, which had about $13 million in revenues last year, owns roughly 40 percent of the HCS-instrument market, though a January 2004 report from research firm Research and Markets said Cellomics had about a 45-percent market share. Also, according to Research and Markets, a March 2005 survey of 75 HCS users that Cellomics' ArrayScan was the most common instrument purchased.
It is quite likely, however, that Cellomics' market share has recently declined, as a slew of comparatively larger companies — such as Molecular Devices, Evotec Technologies, BD Biosciences, and Beckman Coulter — made significant headway in 2004 by either introducing new HCS instruments or beefing up existing product offerings.
Fisher said it plans to cultivate a relationship with microscopy giant Carl Zeiss, Cellomics' largest shareholder before the acquisition and whose Apotome confocal-enabling optical grating is the key technological component of Cellomics' instruments.
"I would say that we'll be working hard to expand the product portfolio on the instrument side. The optics are a big part of this technology, and there are some proprietary Zeiss components within the Cellomics instruments, so we've got access to those," Friel told CBA News. "And we've also got access, on an ongoing basis, to improvements that Zeiss brings to the market."
Another of Fisher's challenges will be maintaining Cellomics' HCS market share by selling new instruments. Clearly the ability to package several categories of reagents with its ArrayScan or KineticScan instruments gives Fisher a leg up, but the company currently lacks a significant sales force for high-end laboratory instrumentation.
"Clearly the kind of instrumentation Cellomics has is a little different than the traditional products we've sold through our other channels — although, in some of those areas, like the immunohistochemistry market and anatomical pathology, we do sell relatively high average-selling-price pieces of equipment," Friel said. "So we do have some selling capability in-house that has the right skill set."
But, he added, Fisher will depend primarily on Cellomics' existing sales and marketing force to further drive instrument sales, and, to a lesser extent, on Zeiss, which has served as a sales, marketing, and distribution agent for Cellomics in "select" global markets.
"It's our intention to leverage that channel very aggressively," said Friel. "We've got a number of other areas where we're looking to cooperate with Zeiss, and we think that's going to be a very strong part of our sales and distribution strategy."
Fisher also said that layoffs at Cellomics are very unlikely, and, quite the opposite, Fisher's post-acquisition plans may actually infuse the Cellomics sales force with new blood.