INDUSTRY NEWS
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Siemens Medical Solutions (Malvern, PA) and Diagnostic Products Corp. (DPC; Los Angeles) have entered into a merger agreement under which Siemens will acquire DPC for approximately $1.86 billion. According to the agreement, each DPC shareholder will receive $58.50 per share of DPC stock, and DPC will become a wholly owned subsidiary of Siemens. The completion of the merger is subject to approval by DPC’s shareholders, receipt of regulatory approvals, and other customary closing conditions. Each company’s board of directors has approved the agreement, and the shareholders meeting is scheduled to be held in mid-2006.
“We are impressed by DPC’s track record in developing a globally leading immunodiagnostics business and by the quality of its people,” said Erich R. Reinhardt, president and chief executive officer at Siemens Medical Solutions. “The potential is huge to drive groundbreaking innovations by combining DPC’s IVD leadership with Siemens’ medical imaging and healthcare IT solutions.”
Through this acquisition, Siemens intends to expand its existing healthcare solutions portfolio and further the company’s objectives of enabling early and specific diagnosis and individualized patient therapy. Siemens officials stated that the DPC acquisition is a major milestone in the development of integrated, clinical work flow–oriented solutions that will improve the quality and increase the efficiency of patient care.
“Our vision and strategy is to improve quality of care, and we think that in order to achieve this, we need to integrate diagnostic solutions across the whole healthcare continuum. That’s why IVDs are of strategic relevance to us as a company,” says Mohammad Naraghi, MD, PhD, senior vice president of business development at Siemens. “We are interested in being the company that for the first time in the industry brings together IVDs, in vivo diagnostics, and healthcare IT. We think that bringing together in vitro, in vivo, and IT is absolutely key for putting us in the lead ahead of the competition in the healthcare space that we see in the near future.”
Naraghi said that as IVD technologies improve, there will be a growing clinical need to link IVDs with the ability to visualize and localize disease states early and specifically in vivo. He also gave an example of researchers who are conducting research in proteins that have been identified through genomic scans. Such researchers who have identified those candidate proteins and markers often do not have the skills and technological base to develop antibodies against those proteins, purify them, and use them for imaging purposes.
“In vitro genomic-based companies need significant in vivo and immunoassay expertise to come up with new imaging solutions,” he added. “So from that perspective, we think there’s going to be a tremendous need for bringing together in vitro and in vivo under one roof, and intelligently linking them with new IT solutions.”
DPC officials believe that the merger is a positive step for DPC and will continue to support what the company has been doing. Officials added that if the board did not feel that the merger was in the best interest of their shareholders, they would not have approved the agreement.
“We believe that this merger with Siemens will be a very positive development for the future of our employees, customers, and the company as a whole,” said Michael Ziering, DPC’s chief executive officer. “This merger will allow us to continue on our current course of development, while also providing DPC access to the resources and support of a leader in the delivery of integrated healthcare solutions. Siemens is a perfect match for DPC in terms of corporate philosophy, business practice, and future direction.”
