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Life Science Mass Spec Posts Solid Q3 Driven by Academic, Pharma Spending

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NEW YORK(GenomeWeb) – Mass spec vendors turned in mixed third quarter results, but mass spec instrumentation itself showed solid growth, with particular strength in the North American academic and government markets.

The quarter also saw several new product announcements – in particular, products targeted at the clinical space, including AB Sciex's 4500MD Triple Quad and 4500MD QTRAP systems and a clinical system from Thermo Fisher Scientific consisting of the company's Prelude MD HPLC, Endura MD triple quadrupole, and ClinQuan MD software.

One of the most notable areas of mass spec strength was the North American academic and government markets. This marked a continuation of Q2 trends, in which a number of vendors noted renewed growth inUSacademic spending after a first quarter in which several firms experienced difficulties with such customers due to spending delays.

At Agilent, which this week posted Fiscal Year 2014 Q4 revenue growth of 5 percent, academic and government spending on life science research was up 4 percent driven by a 6 percent rise in theUS.

 

Thermo Fisher, which posted a 31 percent jump in Q3 revenues to $4.17 billion but missed Wall Street's top line estimate of $4.21 billion, also noted strong growth in the North American academic and government market, as did Danaher, which posted a 4 percent rise in Q3 revenues and mid-single digit growth at AB Sciex.

 

Waters, which reported an 8 percent jump in Q3 revenues, likewise observed strong academic and government growth in the US. Academic and government demand was also strong inEurope, where it was up double digits, the company said.

Life sciences research was also a bright spot at Bruker, which saw Q3 revenues decline by 4 percent. Here, though, the company's fortunes were more mixed as its relatively heavy investment in MALDI mass spec has left it exposed to that technology's decline in popularity among proteomics researchers.

"[MALDI-TOF] is still needed, but it is not the primary tool for proteomics anymore," Bruker President and CEO Frank Laukien said on a conference call following the company's earnings release. "So even though in the last few years we became a pretty clear number one in MALDI-TOF for the research applications, its growth had been sluggish."

MALDI continues, though, to make inroads into the clinical marketplace. Indeed, Bruker saw double-digit revenue growth from its MALDI Biotype clinical microbiology mass spec system during the quarter.

Beyond that, MALDI has emerged as a potential technology for traditional protein biomarker work where it could offer simpler workflows and higher throughput than triple-quad systems. For instance, firms including SISCAPA Assay Technologies and MRM Proteomics are investigating use of Bruker's Microflex LT instrument, the system used in the company's MALDI Biotyper platform, for clinical quantitation of protein biomarkers.

Nonetheless, triple quadrupoles are still by far the dominant instrument in targeted protein quantitation.

And, as Laukien noted, in the proteomics research arena (as well as many applied markets), electrospray-based instruments like Q-TOFs and Orbitraps have become the tools of choice. On the bright side, this has redounded to the benefit of Bruker's QTOF portfolio, which, he characterized as showing "good growth" in Q3.

Waters also noted strong demand from life science researchers for its QTOF systems, with Waters Chairman, President, and CEO Douglas Berthiaume saying on a conference call following release of the company's Q3 results that "demand for research-focused UPLC-MS systems was up double digits in the quarter" and that demand was particularly strong among customers in proteomics and phenomics research.

He added that the Xevo G2-XS QTOF, which the company introduced at the American Society for Mass Spectrometry annual meeting in June, "has been very well received across a wide range of life science applications."

Berthiaume also cited growing interest and investment in mass spec within medical research.

"Recognizing that proteomics, metabonomics, [and] phenomics [are] going to be an important part of delivering meaningful diagnostics and therapeutics, [institutions] are really ramping up the investment in mass spectrometry, particularly in the large-scale academic medical centers where we have had a huge amount of interest and significant order rates," he said. "I think that piece of the healthcare marketplace is very strong, and you see that reflected in our results and our expectations going forward."

Several vendors also noted strong pharma demand during the quarter.

Waters reported growth in its pharma business in the US and Japan as well as in India where the company saw double-digit growth due to generic drugmakers adding new instruments and replacing old ones.

Both Agilent and Thermo Fisher noted strong demand from biopharma customers. Biopharma has in recent years emerged as a major area of interest for mass spec vendors with a number of companies putting out new products and methods targeted at that market.

Fred Strohmeier, president of Agilent's life sciences and diagnostics group, noted on the company's Q4 earnings call this week that biopharma makes up around 20 percent of the overall pharmaceutical market and is growing at around 18 percent a year, compared to around 3 percent to 5 percent for the overall pharma industry.

He added that the company is currently "seeing a lot of instrument refresh," from pharma.

One area of ongoing vendor concern has beenChina, and here there was little change, though Agilent reported increased demand among Chinese life sciences researchers, fueled by what President, COO, and CEO-Elect Mike McMullen characterized as "a return to levels of improved, albeit still subdued government spending."

Thermo Fisher posted low single-digit growth in China, with CEO Marc Casper noting that "slow release of funding by the Chinese government ... is impacting revenue."

Waters, meanwhile, finished the quarter with a mid single-digit decline in Chinese sales, although a modest increase in orders.

Berthiaume said that the company does not "expect to see a dramatic change [in the Chinese market] in the fourth quarter."

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