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Luminex Snags Partnership with Celera Diagnostics, Plans to Spin Out RBM Unit


Luminex has recently announced two more moves into the diagnostic field with its xMAP technology. Last week, the company struck a licensing deal with Celera Diagnostics, and the week before it announced plans for spinning out its Rules-Based Medicine (RBM) diagnostics project into a company of the same name that would become a partner for Luminex.

While Celera will be ”yet another partner” – adding to about 40 others, both from the research and the diagnostic arena – it’s the name that counts most for Luminex. ”A partner with the reputation of a Celera is a big step for Luminex,” said Harriss Currie, Luminex’s acting chief financial officer. However, revenues from the partnership, he added, will only become significant for Luminex once Celera has developed a test and pays royalties.

In exchange for royalties from future diagnostic products and revenues from sales of instruments and reagents, Luminex granted Celera Diagnostics the right to develop and distribute in vitro diagnostic products using its technology.

xMAP is based on microspheres with up to 100 different fluorescent signatures that allow users to assay for up to 100 different molecules in a sample in parallel. The company has said that its technology offers reactions that save on reagents, consumables, and labor; rapid kinetics; and small sample sizes. The system is also relatively inexpensive: the Luminex 100 instrument system sells for $49,500 and the actual microspheres go for about $100 per ml.

Additionally, the microspheres are adaptable to a wide variety of applications, including measurements of nucleic acids, enzymes, and receptor-ligand interactions. Partly due to this flexibility, the company has centered its business model around partners who can develop applications for its products. While this has meant that there are 12 drug discovery kits based on xMap and nine clinical diagnostics kits, the company’s lack of control over the sales of kits by partners has led to financial instability. In four out of the past five quarters, the company has issued warnings that its revenues would be lower than initially expected.

Spin-Out Control

In a move that might counterbalance this uncertainty somewhat, Luminex has announced plans for growing a partner itself: negotiations to form a spin-out from its RBM research and development unit, which has been searching for blood markers for 55 different diseases states using xMAP since last winter, are ”fairly far along,” said Currie. The new entity would be headed by Luminex’ current CEO and president Mark Chandler, Currie said, and would buy the assets and liabilities of RBM. Luminex would receive a preferred stock and common stock equity interest in the company and supply it with instruments and reagents, as well as license technologies to it. ”It will be the same kind of arrangement as it is with all of our other partners,” said Currie. However, it would not necessarily compete with the others, since each partner is only licensed to work in a certain field, such as in vitro diagnostics or genotyping, he said.

Distributing its technology to others who put it to use in a specific area seems to be the preferred strategy for Luminex, explaining why the planned spin-out makes sense. ”We’ve turned our technology over to people who are specialists in those different areas, and they are now creating tests for their own markets that they understand much better than we do,” said Chandler in a recent interview with BioArray News’ sister publication ProteoMonitor.

The new company would concentrate on both toxicology assays for pharmaceutical companies and diagnostic tests, he said.

– JK


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