The story has been updated to include comments from GenMark.
NEW YORK (GenomeWeb News) – Luminex and Natural Molecular Testing have entered into a multiyear collaboration and licensing deal, resulting in a comprehensive personalized medicine panel.
The laboratory-developed panel, which is built on Luminex's xMAP technology is being launched today by NMT and comprises 42 targets.
In reaction, GenMark Diagnostic's stock price plummeted on the suggestion, based on today's announcement, that NMT is replacing its existing GenMark instruments with Luminex's platform.
Seattle-based NMT is a privately owned high complexity molecular testing facility. According to the company, adverse drug reactions result in the hospitalization of 2 million Americans and 100,000 deaths each year. Molecular testing to diagnose genetic abnormalities in patients can help physicians choose the most appropriate medications and dosages, while minimizing risk for conditions such as chronic heart disease and pain.
"By converting to Luminex's xMAP technology we can improve our throughput and workflow efficiency with more comprehensive and highly sensitive assays that set us apart in the workplace," NMT CEO Beau Fessenden said in a statement.
NMT's panel includes CYP450 2C19; CYP450 2C9; VKORC1; Factor II; and Factor V Leiden, among others.
"Through the use of genetic testing, driven by the throughput and scalability of our technology and the unique services of [NMT], our two companies are working together to optimize patient outcomes and lower overall healthcare costs," Luminex President and CEO Patrick Balthrop said.
Financial and other terms of the firms' deal were not disclosed.
The announcement drove shares of GenMark down as much as 32 percent in heavy trading today on the Nasdaq. In a research note, PiperJaffray analyst William Quirk said that "preliminary diligence" suggest the NMT-Luminex deal is an instrument replacement agreement in which NMT will replace GenMark's platforms with Luminex instruments, "leading us to believe revenue [to GenMark] from this important customer is at risk."
NMT is one of GenMark's largest customers, and in the first quarter, NMT-associated revenues represented about 62 percent of GenMark's total revenues. The two firms also entered into a reagent rental agreement a year ago that terminates in September 2016, but if NMT were to renege on the deal, the most GenMark can do is pull its instruments "based on our read," Quirk said.
In his note, he trimmed his full-year 2013 revenue estimate for GenMark to $29.6 million from an earlier estimate of $35.7 million, and reduced his full-year 2014 revenue estimate to $39.7 million from $51.7 million, but maintained an Overweight rating on the company.
In late afternoon trading, GenMark's shares were down 16 percent at $12.70.
In an SEC document filed after the close of the market on Tuesday, GenMark said it has not received notice from NMT of the two firms' agreement, and the agreement "remains intact." The firm is evaluating the impact, if any, of NMT's deal with Luminex on GenMark, it said.