PerkinElmer this week expanded its software offerings by acquiring ArtusLabs and CambridgeSoft, both of which are life science-informatics firms with complementary products that the instrumentation vendor expects will help its customers share and integrate data.
PerkinElmer has completed its acquisition of ArtusLabs and expects to close its deal with CambridgeSoft in the second quarter.
The combined purchase price for the privately held firms is $220 million, though there is the possibility of an additional $15 million in earn-outs that would bring the final price tag to $235 million.
PerkinElmer said the two companies should generate around $65 million in aggregate revenue this year.
CambridgeSoft offers software and services for pharmaceutical, biotechnology, and chemical industries. Its products include desktop software for chemists such as ChemDraw, Chem3D, and ChemOffice; as well as tools for biologists such as the pathway drawing tools BioDraw and the data-management tool BioAssay.
The firm also offers an electronic notebook that incorporates Microsoft Excel and Word and ChemDraw files, as well as a cloud-computing platform that incorporates several of its software packages.
ArtusLabs, meantime, offers the Ensemble Electronic Lab Notebook, which is designed to help users capture experimental data and provide decision support or medicinal chemists, biologists, and bio-analytical scientists.
The firm also markets several toolkits, such as Reaction Genius and Sub-Structure Search, which provide more specialized functionality.
PerkinElmer said it expects the companies to allow its customers "to rapidly access and share enterprise-wide data for faster, more informed scientific decisions."
“The ability to integrate scientific tools and informatics is becoming increasingly critical for our customers as they look to drive productivity and speed to market,” PerkinElmer CEO Robert Friel said in a statement.
Friel said that CambridgeSoft brings "strong customer relationships and excellent organizational capability, along with market-leading products in both desktop and enterprise-wide software," while ArtusLabs "provides us with innovative technology enabling enhanced access to scientific knowledge."
He added that the ArtusLabs portfolio is "highly complementary to CambridgeSoft’s informatics solutions.”
In particular, Friel said that the acquisitions, combined with PE's OneSource laboratory asset-management service, "make us uniquely qualified to enable highly efficient laboratory environments and increased scientific productivity.”
The new products will add to PerkinElmer's existing informatics stable, which includes the Acapella, Columbus, and Volocity image analysis products; SpectralWare array-analysis software; LabWorks LIMS; and other tools.
These purchases mark PerkinElmer's second investment in life sciences-based software this year. In January, the firm licensed Geospiza's GeneSifter Analysis Edition Software to provide laboratory management and data analysis for its new next-generation sequencing and analysis service.
The firm also launched an Internet-enabled "private-cloud" to enable clients to access their genomic data and gives them data storage space (BI 01/28/2011).
'Mixed Results'
In a statement, David Brailer, chairman of CambridgeSoft investor Health Evolution Partners, said that the combination of CambridgeSoft's software with PE's technology "is a perfect union for the next generation of pharmaceutical development."
Health Evolution Partners and Goldman Sachs invested $31.3 million in CambridgeSoft in 2009 (BI 11/16/2009).
Several industry analysts noted that the new software acquisitions complement PE's lab-services offering and should increase the firm's presence among large pharma research and development markets.
Quintin Lai, an analyst with Robert Baird, said in a research note that PE "will be able to leverage CambridgeSoft’s existing customer base for sales of OneSource, and OneSource’s broad customer base for CambridgeSoft."
Further, he said that CambridgeSoft’s focus on database and bioinformatics solutions "is portable broadly to other labs."
While ArtusLabs "is the smaller of the two acquisitions," Lai said that the company's indexing and searching software "will be an appropriate fit for both OneSource and CambridgeSoft for streamlining lab operations."
However, others pointed out that past partnerships between analytical instrument firms and software vendors have not always been successful.
Dan Leonard, an analyst with investment bank Leerink Swann, said in a research note that previous acquisitions of this type have had "mixed results."
For instance, he said "we don't believe Waters' acquisitions of Creon Scientific and NuGenesis have been successful, and Symyx's roll-up of Intellichem, Synthematix, and MDL fell shy of expectations. We believe the sales of scientific software and analytical instruments are often made separately by the customer, and thus each offering must stand on its own."
Waters acquired NuGenesis in 2004 and Creon Scientific the year before (BI 02/02/2004), while Symyx purchased MDL in 2007 (BI 08/17/2007).
Leonard said he considers CambridgeSoft to be the "number two player in scientific software" behind Accelrys, and said that the company "was a faster-growing and more profitable company than its peers."
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