Invitrogen Forecasts Strong Revenue Growth, R&D Boost, More Acquisitions in 2004
Invitrogen executives this week predicted double-digit growth in revenues and profits for the 2004 fiscal year, accompanied by an increase in R&D spending, and a continuation of the company’s aggressive acquisition strategy.
At its annual guidance conference, held at New York’s W Hotel, CEO Gregory Lucier outlined Invitrogen’s outlook for becoming the “premier biotechnology company in tools and technology” — a plan that comprises revitalizing the organic growth of the company’s current product line, enhancing the effectiveness of its sales process, improving its operational efficiency, and pursuing new acquisitions in high-growth technology areas.
Invitrogen has become “adept at integrating acquisitions” over the last year, Lucier said, and the company views acquisitions as “an important part of its strategy for 2004.” Lucier declined to provide details on the company’s acquisition pipeline, but noted that Invitrogen sees the most growth potential in areas downstream of genomics. New technology areas of interest include functional genomics, proteomics, cell biology, assay development, and drug development, he said.
The company has over $1 billion cash on hand for acquisitions and other investments, Lucier noted.
In addition, Invitrogen’s current business segments — Molecular Biology and Cell Culture — have been renamed Biodiscovery and Bioproduction, respectively, to reflect a more “expansive view” of the drug discovery and development pipeline, Lucier said.
In line with this more holistic approach to life science research, Invitrogen is currently retraining its sales staff towards “solution selling” rather than one-off product sales, he said, with the goal of increasing the average purchase order from $400 to $5,000 by offering bundled, “product systems” for targeted research areas (see PM 11-28-03).
The net effect of the anticipated sales boost is a projected revenue increase of 16 percent year-over-year, to $890 million in 2004. Net income is projected to be $749 million for 2004 — a 26 percent increase over 2003. The Biodiscovery segment is projected to bring in revenues of $580 million for 2004, a 6 percent increase over 2003; while the revenue forecast for Bioproduction is $310 million for 2004, an 11 percent increase over 2003. Invitrogen plans to ramp up R&D over the course of 2004, with R&D spending expected to increase to $77 million, or 10 percent of sales, compared to $54 million, or 7 percent of sales in 2003.
The company also plans to reopen its Frederick, Md., R&D facility, which it closed following the acquisition of Life Technologies in 2000.
Surromed Pairs with Ingenuity on Biomarker Discovery
SurroMed and Ingenuity, both of Mountain View, Calif., announced this week that SurroMed has licensed Ingenuity Pathways Analysis, Ingenuity’s web-based application for studying biological networks. The application will be used for differential analysis and profiling in proteomic and metabolomic experiments using SurroMed’s mass spec-based biomarker discovery platform.
Financial details of the deal were not disclosed.
Caliper Cutting 12 Percent of Workforce in Restructuring Plan
Caliper Technologies announced late last week that it is again reducing its workforce, with net reductions adding up to 12 percent of its current workforce — a total of 65 people, including seven at the vice president level — as part of its restructuring plan following its acquisition of Zymark in July.
Caliper said in a statement it will also make some hires “to accommodate the move of certain functions to the company’s Hopkinton headquarters, and to add skill sets which will support the company’s strategic direction.” The senior management team has been reorganized as a result of the restructuring (see Movers & Shakers, p. 2).
Caliper said that the latest reconfiguration is focusing on rationalizing R&D resources. The company aims to reach cash-flow breakeven by the end of 2005.
Prolexys and Whitehead Collaborate on Chemiproteomics
Prolexys Pharmaceuticals, formerly Myriad Proteomics, announced this week that it is collaborating with the Whitehead Institute to use compounds from Whitehead and Prolexys’ HySpec mass spec platform and chemiproteomic techniques to search for new oncology targets.
The collaboration will last for two years under the current agreement. Scientists will look to identify compounds with limited toxicology and side effects. Brent Stockwell’s lab at Whitehead will provide the compounds and will modify the compounds following the proteomic studies at Prolexys.
Financial terms of the agreement were not disclosed.