Luminex this week made a play for the low- to mid-volume molecular diagnostic testing market by when it announced that it is acquiring privately held molecular diagnostics developer GenturaDx for $50 million.
With the acquisition, Luminex will inherit GenturaDx's IDBox platform, a fully integrated and automated real-time PCR system that uses disposable testing cassettes — a "tried and true industry-standard approach," Luminex President and CEO Patrick Balthrop told PCR Insider.
The GenturaDx platform, which is in the final stages of development, is expected to complement Luminex's existing highly multiplexed commercial molecular testing platforms, Balthrop said. In addition, it provides Luminex with a system on which to develop real-time PCR assays using the MultiCode-RTx chemistry that it acquired along with EraGen Biosciences last year, he added.
"This acquisition will give us the ability to serve our molecular diagnostic customers more completely, and [will] also … open up significant new market segments for Luminex [facilitated by] the highly automated, easy to use, sample-in-answer-out GenturaDx system," Balthrop said.
Details of the acquisition call for Austin, Texas-based Luminex to buy Hayward, Calif.-based GenturaDx for $50 million in cash and potential additional consideration based on milestones and/or product revenue performance.
Luminex said that the acquisition will add around $6 million to its 2012 operating expenses and will be dilutive on a GAAP basis. Luminex expects to record charges for cash and non-cash acquisition-related costs in connection with the deal, though it has not yet determined the full extent of those charges. It added that it will recognize a portion of the these costs in the second quarter.
First unveiled in 2010 at the Association for Molecular Pathology annual meeting in San Jose, Calif., GenturaDx's IDBox is a closed system that enables processing of one to 12 samples per instrument in two to four hours' time (PCR Insider, 11/18/2010).
The typical IDBox protocol calls for a technician to pipette a sample into a disposable test cartridge, scan the cartridge barcode, place the cassette with others into the instrument magazine, insert the magazine into the benchtop reader, and press a single button to initiate testing.
Using a combination of proprietary and licensed real-time PCR chemistries, GenturaDx has developed and internally tested assays for a variety of infectious diseases for the IDBox, the most advanced of which is an assay for detecting and differentiating herpes simplex virus I and II that the company had previously said would be commercially available by early next year.
This contrasts with Luminex's existing benchtop platforms, on which the company runs highly multiplexed assays based on its xMAP and xTAG bead technology. Luminex has already had a respiratory virus panel and its next-generation version, the RVP Fast, approved as in vitro diagnostic products by the US Food and Drug Administration. The company also offers several different FDA-cleared multiplexed cystic fibrosis assay kits, and has several other multiplexed assays in development.
"We have a dominant market position … in multiplexing molecular diagnostics," Balthrop said. "We're the number one company in CF … and [respiratory virus panels] by a wide margin."
However, some of Luminex's customers regularly performing those assays "also have a need to generate individual molecular diagnostic tests, or tests that have one-, two-, three-, or four-plex-sized panels, and the GenturaDx instrument platform will serve that segment of the market, but it's actually the same customer," Balthrop said. "We don't think anyone else can match …the synergies that we're going to get by having an integrated assay and instrument, and a molecular diagnostics play to leverage our current dominant position in multiplexing."
Luminex actually took the first step toward building out this complementary molecular diagnostics play last year when it acquired Madison, Wis.-based EraGen Biosciences for $34 million (PCR Insider, 6/23/2011).
Luminex said at the time that it primarily purchased EraGen for products based on its proprietary isoC and isoG technology — probe-free bases that are structurally similar to but do not pair with naturally occurring bases, instead pairing with each other.
EraGen, and now Luminex, uses this technology as part of two assay chemistries: MultiCode-PLx for multiplex, endpoint PCR applications; and MultiCode-RTx for real-time PCR applications. The company originally sold its kits as analyte-specific and research-use-only reagents, but in April 2010 its MultiCode-RTx assay for herpes simplex I and II virus detection received FDA clearance, making it the first molecular IVD to detect and type HSV 1 and 2 in symptomatic women.
Luminex already had instrument platforms ideal for running highly multiplexed endpoint PCR assays using the MultiCode-PLx chemistry; but it was apparently seeking an instrument platform that would better pair with the real-time MultiCode-RTx assays.
"We expect to use the MultiCode-PLx with projects that we have in the pipeline that will be valuable to the customer because the chemistry is more streamlined," Balthrop said. "The MultiCode-RTx chemistry is one that we're selling today, and will be applicable with our current franchises, but is also what we'll focus on with the GenturaDx transaction. Before you acquire a company, you do appropriate due diligence, including technical due diligence, and we're extremely confident that the MultiCode-RTx chemistry will be compatible with the GenturaDx platform."
Last year, at Select Biosciences' Molecular Diagnostics World Conference in South San Francisco, GenturaDx presented data demonstrating that its ID HSV 1/2 assay — which was based on EliTech's MGB (minor groove binder) Alert ASR and which ran on the beta version of IDBox — had sensitivity and specificity comparable to or greater than three commercially available HSV assays, including EraGen's MultiCode-RTx HSV 1&2 kit (PCR Insider, 9/29/2011).
Also, at the American Society of Microbiology meeting last month in San Francisco, researchers from GenturaDx and the University of California, San Francisco, presented data showing that the assay had comparable sensitivity, specificity, and reproducibility compared with the same EraGen assay (now marketed by Luminex) and HSV tube culture. However, the study also demonstrated that the GenturaDx assay could be performed using four steps in about three hours — compared to the Luminex/EraGen assay, which required 38 steps and took more than four hours to complete.
This underscores the specific molecular testing market that Luminex will hope to target with GenturaDx's platform — smaller hospitals and labs with lower throughput than the larger hospitals and testing centers that might be running a Luminex multiplexed test.
Balthrop declined to disclose whether Luminex would still expect to launch the GenturaDx HSV assay in early 2013, noting that the company "is not disclosing our pipeline plans at the moment. We realize that it's important to have a robust and differentiated assay menu, and we expect to have one, but we haven't disclosed our plan in detail."