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JP Morgan Healthcare Conference, Day One: Waters, Sigma-Aldrich, Agilent

This article has been updated from a previous version to clarify information about Agilent's life science business and overall business in the Asia/Pacific region.

SAN FRANCISCO (GenomeWeb News) – The 30th Annual JP Morgan Healthcare Conference kicked off Monday here with several life science tools firms making presentations to some of the more than 8,000 investors and company representatives in attendance.

Below are capsules from the presentations and breakout sessions of Waters, Sigma-Aldrich, and Agilent Technologies.

Waters

Waters President and CEO Douglas Berthiaume said that he is confident the firm can maintain an organic growth rate above the industry average through a combination of new products, such as the Synapt G2-S mass spectrometer and Acquity I-Class UPLC system, and penetration of new and emerging markets. He said emerging markets are providing the firm with "strong" double-digit growth.

And while many in the life science tools market are concerned about academic spending, Berthiaume noted that Waters derives less than 15 percent of its revenues from academic/government customers. The pharmaceutical/biotech markets provide the firm with around 63 percent of its revenues, and Berthiaume noted that despite issues for the global economy, 2011 "was a pretty good year" for pharma spending on a global basis. He further noted that for 2012 the "symptoms are not bad" for that market, which also includes clinical research organization customers.

Waters finished the third quarter with $1.19 billion in cash and short-term investments on its books. But even with that war chest, Berthiaume noted that the firm wouldn't likely use those funds for a big acquisition. Waters has traditionally stuck to smaller, tuck-in acquisitions that match its core competencies, and Berthiaume said the firm usually doesn't make huge bets that may negatively affect its P&L.

Sigma-Aldrich

One of the keys behind Sigma-Aldrich's $350 million acquisition of BioReliance, announced earlier Monday, was the potential of combining Sigma-Aldrich's zinc finger nuclease gene-editing technology with the biopharmaceutical testing services of BioReliance, President and CEO Rakesh Sachdev said.

He noted BioReliance's broad reach among the top biopharmaceutical companies, with a large swath of its $110 million in annual revenue coming from biologics testing. The acquisition will enable Sigma-Aldrich to offer customers end-to-end solutions for biologics development, said Sachdev.

Agilent Technologies

In addition to re-emphasizing the company's plans to move further into the academic market, which now makes up 8 percent of Agilent's total business, company officials reiterated their goal to continue the firm's expansion into the Asia/Pacific region.

The region now represents about 31 percent of Agilent's total life science revenues and 39 percent of total revenues, compared to the Americas, which comprises 37 percent of total revenues, and Europe, which comprises 32 percent of revenues. But according to Nick Roelofs, president of the company's life science business, as countries such as China and India continue to invest in the life sciences sector, the company will increase its investment into the region, including additional hirings. About 17 percent of Agilent's life science employees are now in Asia/Pacific and more than 40 percent of its total employees are in the region.

China is now Agilent's second-largest country in life sciences. The firm saw 29 percent growth there in the fourth quarter of 2011 over the comparable period of 2010, Roelofs said, while India grew 15 percent during that time. Among the initiatives the company is spearheading is an expansion of a life science application research center in Bangalore, India, while in Penang, Malaysia, Agilent is building a PCR instrument R&D team, Roelofs said.

Discussing the company's end markets, he said that he believes the academic/government sector will remain stable as governments in Europe and the US signal an unwillingness to cut science funding. He added that in pharma/biotech, the picture is more unclear as that sector remains reluctant to spend on tools and instruments — a different conclusion to that reached by Waters' Berthiaume.

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