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As Caliper Eyes Further Revenue Growth, It Extends Technology to Adherent Cells

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As Hopkinton, Mass.-based Caliper Life Sciences prepares to release its first-quarter financial results, the company anticipates its seventh consecutive quarter of year-over-year revenue growth.

Caliper attributes this growth to the fact that its LabChip microfluidics platform and liquid handling and laboratory robotics continue to gain traction among pharma. The growth is also due in part to Caliper's ongoing addition of cell-based assay capabilities to its flagship LabChip platform, and to pharma's growing interest in cellular assay technologies.

Since Caliper acquired lab automation firm Zymark for $71 million in July 2003, it has posted six straight quarters of year-over-year revenue growth [see chart, below]. Most recently, fourth-quarter revenues increased 12 percent to $24 million, and the company expects revenues in the first quarter to increase by as much as 11 percent year over year to between $17 million and $19 million, Kevin Hrusovsky, Caliper's president and CEO, said in a recent statement.

Furthermore, in 2004 Caliper saw its year-over-year net losses either remain flat or decrease each quarter, culminating with a 65-percent reduction in its fourth-quarter net loss, which fell to $7 million from $20 million in Q4 2003.

The majority of Caliper's initial revenue increase was a direct result of taking on Zymark's stable of products. Caliper's total revenues for Q2 2004 were $18.9 million, as compared with $5.9 million from Q2 2003, the last quarter that did not reflect contributions from Zymark products. However, the company has previously said that a portion of its early revenue growth was organic.

Caliper doesn't break out its revenues from specific product lines, so it is unclear exactly how much LabChip sales contributed to the company's bottom line.

However, Michele Boudreau, a Caliper spokesperson, told Cell-Based Assay News last week that approximately 25 percent of its revenues come from LabChip products, while the remaining 75 percent comes from the "macro"-fluidics part of Caliper's business unit. This latter category includes the Sciclone line of liquid-handling stations and Twister plate movement and storage robots. The company also sells a few drug-discovery platforms that integrate several of its individual product offerings.

Amplifying Amphora

Boudreau said that Agilent Technologies is currently Caliper's biggest customer, contributing about 11 percent of Caliper's annual revenues of $80.1 million, "mostly from microfluidic chips," she said. And a recent deal with Amphora to sell the drug maker more than $1 million of worth of LabChips each year for the next two years will help drive Caliper's future overall top line growth (see CBA News, 4/18/2005).

"Amphora had an old contract in place [in which] they pre-paid for data points and consumables, and even some instruments, I believe, in 2003, which they received in 2004," Boudreau said. "So, in 2004, there was sort of a void where Amphora revenues should have been, because they were all pre-paid. So we're now back on track with them as a more regular customer with a regular contract."

Boudreau declined to provide specific financial details of the agreement.

In fact, Amphora has already made a significant contribution to Caliper's revenue growth, as the drug-discovery firm already has 28 LabChip platforms up and running at its Research Triangle Park, NC, facilities, according to Bill Janzen, Amphora's founder and vice president of operations.

"They are the core platform of our drug-discovery operation. We've been using the Caliper system since 2001 when we were founded, and have steadily expanded the ways that we can use it since then," Janzen told Cell-Based Assay News last week. "We keep [the LabChips] at a variety of production levels, but we do have a group in our high-throughput screening area where we keep them running 24 hours a day."

Amphora says that it uses the LabChips to perform high-throughput screening against a variety of pharmaceutical drug targets, including kinases, proteases, phosphatases, ion channels, and GPCRs.

"We're applying the technology in a number of different areas, but we're trying to cover entire cellular pathways, entire platforms or families of targets, and … a series of druggable targets and their counter-screens," Janzen said. "Initially we went into kinases very heavily, and did proof-of-principle [studies] in proteases and phosphatases, but we just made the decision to invest a little more heavily into proteases.

"One of the real advantages of the Caliper technology and the way we've applied it here is that we're now generating data that is directly comparable across these different protein families," Janzen added. "So we can now go in and look at directly comparable selectivity across kinases, proteases, histone deacetylases, histone acetyltransferases, phosphatases, and ion channels."

Since several of these drug targets are most amenable to a cell-based screen, Caliper, through technology it actually licensed from Amphora, has now enabled LabChip to be compatible with popular adherent cell lines — such as CHO, HEK, and RBL-2H3 — in addition to the non-adherent cell lines that the system was already capable of handling (see CBA News, 5/18/2004).

"That's now available to a Caliper customer that wants to use it, the ability to do a wider variety of cells, including some adherent cells," Boudreau said. "Amphora has said that they are also doing ion channel screening. We're working on our own program for that, and … that's a cell-based assay, and a holy grail, kind of."

Boudreau also said that Molecular Devices is clearly Caliper's biggest competitor when considering cell-based drug screening.

"FLIPR is what people are used to when doing GPCR screens, but it only does adherent cells," Boudreau said. "So that was really our driving motivator: 'Well this is my cell line, I want to be able to use this; can you guys accommodate it?'

"We already offered something that FLIPR couldn't," Boudreau added, referring to LabChip's microfluidics capabilities. "But [the reason for the adherent cells] was to offer something that FLIPR could, so people could make the transition more easily."

— BB

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