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Archive for July, 2009

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IVD Companies Report Mixed Results

Friday, July 31st, 2009

Beckman Coulter Inc. (Brea, CA) announced second quarter and first half ended June 30, 2009 results. Total second quarter revenue was $756.7 million, down 5.2%, or flat in constant currency terms. On a constant currency basis, recurring revenue increased 7.7%, offset by the anticipated decline in cash instrument sales. Reported net earnings were $60.8 million, or $0.94 per fully diluted share. Adjusting for special items, net earnings were $63.9 million, or $0.99 per fully diluted share, an increase of 15.1% over prior year quarter.

Cepheid (Sunnyvale, CA) reported revenue for the second quarter of 2009 of $41.0 million. Net loss was $6.8 million, or $(0.12) per share, which compares to revenue of $42.1 million and a net loss of $7.7 million, or $(0.13) per share, in the second quarter of 2008. Excluding amortization of purchased intangible assets, stock compensation, and restructuring expenses, non-GAAP net loss for the second quarter was $2.2 million, or $(0.04) per share. This compares to a non-GAAP net loss of $3.7 million, or $(0.06) per share, in the second quarter of 2008.

Gen-Probe Inc. (San Diego) reported financial results for the second quarter of 2009, including non-GAAP earnings per share (EPS) of $0.45 and record sexually transmitted disease (STD), clinical diagnostics, and total product sales. In the second quarter of 2009, product sales were $116.8 million, compared to $113.7 million in the prior year period, an increase of 3%. Compared to the second quarter of 2008, the stronger U.S. dollar reduced product sales growth by an estimated 4%. Total revenues for the second quarter of 2009 were $120.5 million, compared to $119.8 million in the prior year period, an increase of 1%. Net income was $23.2 million ($0.45 per share) on a non-GAAP basis in the second quarter of 2009, compared to $24.8 million ($0.45 per share) in the prior year period, a decrease of 6%. Including $4.4 million ($0.07 per share) of expenses related to the Company’s acquisition of Tepnel, which closed on April 8, 2009, net income in the second quarter of 2009 was $19.8 million ($0.38 per share) on a GAAP basis.

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BD’s IVD Revenues Grow

Thursday, July 30th, 2009

Becton, Dickinson and Company (BD; Franklin Lakes, NJ) reported quarterly revenues of $1.820 billion for the third fiscal quarter ended June 30, 2009, representing a decrease of 1.6% from the prior-year period. Excluding the unfavorable impact from foreign currency translation, which overall is estimated to account for 7% points, worldwide revenues increased 5%.

In the BD Diagnostics segment, worldwide revenues for the quarter were $566 million, representing an increase of 2% from the prior year period. Excluding the unfavorable impact from foreign currency translation of an estimated 6 percentage points, revenues increased 8% in the quarter. Sales of safety-engineered devices, cancer diagnostics products, and infectious disease testing systems, including flu-related products, contributed to revenue growth. For the nine-month period ended June 30, 2009 the BD Diagnostics segment reported 2.5% revenue growth. On a currency neutral basis, BD Diagnostics revenues for the nine-month period increased by 6.5%.

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Life Technologies’ Revenues Increase

Wednesday, July 29th, 2009

Life Technologies Corp. (Carlsbad, CA) announced results for its second quarter ended June 30, 2009. Non-GAAP revenues for the first quarter were $839 million, an increase of 2% over second quarter revenues of $822 million in 2008, as if Invitrogen and Applied Biosystems had been combined. Excluding the impact from currency exchange rates, revenues grew 7.5% over the same period in the previous year.

First quarter GAAP diluted earnings per share were $0.22 which includes $0.42 per share of acquisition related amortization expense, $0.04 per share of non-cash interest expense associated with the adoption of FSP APB14-1, and $0.11 per share of business integration costs and other expenses. On a non-GAAP basis, which excludes these items, diluted earning per share were $0.79.

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OIVD Plans Tighter Regulations of IVDs

Tuesday, July 28th, 2009

The Gray Sheet reported that taking its cue from the new, more aggressive FDA administration, the agency’s diagnostics office aims to tighten its regulatory control over commercial tests and, potentially, lab-developed assays, according to the new OIVD director, Alberto Gutierrez. The new FDA leadership, headed by Commissioner Margaret Hamburg and Principal Deputy Commissioner Joshua Sharfstein, plans to make “huge changes” to the way the agency implements its public health mission, Gutierrez said at the annual American Association of Clinical Chemistry meeting in Chicago.

According to The Gray Sheet, IVD companies can expect more aggressive diagnostics regulation, manifest in several ways, explained Gutierrez, who officially assumed the head role earlier this month. Namely, the new OIVD director acknowledges flaws in the 510(k) premarket notification program, the regulatory pathway by which many IVDs reach the market. The 510(k) program requires commercial test makers to establish the analytical validity, accuracy, precision, and specificity of their IVDs. It also requires some proof of clinical validity, Gutierrez said. But the concept of “substantial equivalence,” the linchpin of the 510(k) program, which allows a test maker to show its test is similar to an already cleared device in lieu of a more extensive safety and efficacy review, invites unwanted variability among test makers, he added.

In addition, he says FDA has allowed companies to use terms in their labeling, such as “sensitivity” (rate of true positives) and “specificity” (rate of true negatives) even when the terms “don’t really describe what manufacturers actually proved to us.” FDA is trying to tighten up the way IVD manufacturers word claims in their labeling, he said.

Finally, FDA has historically exercised little control over companies’ claims of intended use for diagnostic tests, Gutierrez continued. He said FDA is getting better at better defining and focusing intended use claims, though more work is needed on that front, as well.

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Quest Posts Strong Performance for 2Q

Tuesday, July 21st, 2009

Quest Diagnostics Inc. announced that for the second quarter ended June 30, income from continuing operations rose to $188 million from $162 millionfor the second quarter of 2008. These results include a previously disclosed benefit associated with an insurance recovery of $0.05 per share, offset by charges of $0.04 per share associated with the company’s recently completed debt repurchase and an investment writeoff.

Second quarter revenues increased 3.5% to $1.9 billion. Clinical testing revenues increased 4.0% compared to the prior year. Revenue per requisition increased 4.6%. Underlying growth in clinical testing volume, measured by the number of requisitions, accelerated in the second quarter compared to recent quarters. Reported testing volume decreased 0.6%, reflecting a 24% decline in drugs-of-abuse testing volume, which is sensitive to hiring trends, and which reduced the company’s consolidated volume by 1.7%. Changes associated with hospital lab management agreements that the company exited further reduced consolidated volume by about 0.7%.

For the second quarter, operating income increased to $359 million, or 18.9% of revenues, and included the $15.5 million insurance recovery. Operating income was $308 million, or 16.8% of revenues, for the second quarter of 2008.

For the second quarter of 2009, bad debt expense as a percentage of revenues was 4.4%, compared to 4.5% in the first quarter and unchanged from the prior year. Days sales outstanding improved to 43 days, compared to 46 days at the end of the second quarter of 2008 and 44 days at the end of last year. Cash flow used in operations, which reflects the $308 million payment related to the previously announced NID settlement, was $9 million. In the second quarter of 2008, cash provided by operations was $213 million. During the quarter, the company made capital expenditures of $36 million.

For the first six months of 2009, income from continuing operations increased to $357 million from $303 million for the first half of 2008. Revenues increased 2.4% to $3.7 billion.

Operating income for the first half of 2009 increased to $680 million, or 18.3% of revenues, compared to $588 million, or 16.2% of revenues for 2008. Cash provided by operations, which was reduced by $308 million related to the payment of the NID settlement, was $264 million compared to $371 million for 2008. During the first half of 2009, the company repurchased $250 million of its common shares, and made capital expenditures of $76 million.

For 2009, the company today increased its estimated earnings per diluted share from continuing operations to between $3.70 and $3.80. Previously, the company estimated diluted earnings per share of between $3.65 and $3.75. The company expects revenue growth of approximately 3% and operating income of approximately 18% of revenues. Cash from operations is expected to approximate $1 billion before the payment of the previously announced NID settlement, or approximately $700 million after such payment. Capital expenditures are expected to approximate $200 million.

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Asuragen, Biogen Idec Sign Companion Diagnostics Agreement

Monday, July 20th, 2009

Asuragen Inc., a company involved in molecular diagnostics and RNA-based pharmacogenomics services, announced that it has entered into an agreement with Biogen Idec, a U.S. based biopharmaceutical company, to identify a potential companion diagnostic test that may be used to select patients likely to respond to a Biogen Idec therapeutic candidate in clinical development.

“The integrated drug-diagnostic co-development strategy being pursued by Biogen Idec and Asuragen has enormous potential to help physicians identify patients that will benefit from specific cancer treatments, and will be another step towards delivering on the promise of personalized medicine,” said Matt Winkler, CEO of Asuragen. “We look forward to leveraging our long history and broad expertise in biomarker discovery, pharmacogenomic services, and diagnostic development capabilities for this project.”

IVD Technology has published a special report examining the latest issues related to companion diagnostics. For more information about this report, click here.

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DHS Certifies Universal Detection Technology’s Biodefense Kit

Thursday, July 16th, 2009

Universal Detection Technology reported that its handheld biodetection kits have been certified by the Department of Homeland Security as an “approved product for homeland security” under the Support Anti-terrorism by Fostering Effective Technologies (SAFETY) Act of 2002.

The SAFETY Act provides incentives for the development and deployment of anti-terrorism technologies by creating a system of “risk management” and a system of “litigation management.” The purpose of the act is to ensure that the threat of liability does not deter potential manufacturers or sellers of anti-terrorism technologies from developing and commercializing technologies that could save lives.

The handheld detection kits have been extensively used by first responders and private industry throughout the United States. The equipment has been evaluated by the Department of Defense and the UK military.

The certification is for technology developed by Advnt Biotechnologies. The kits are an immunochromatography-based assays used to screen for the presence of biothreat agents. Each assay provides a one-time use capability and is designed to identify one or more biothreat agents, including anthrax, ricin toxin, botulinum toxin, plague (Yersinia pestis), and/or SEB (Staphylococcal Enterotoxin B).

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Gutierrez Takes Over at OIVD

Wednesday, July 15th, 2009

Alberto Gutierrez, PhD, has been appointed the new director at the Office of In Vitro Diagnostic Device Evaluation and Safety (OIVD). According to OIVD officials, Guttierez’s appointment is effective immediately. He takes over the position vacated by Steven I. Gutman, MD, PhD, who stepped down last year.

Gutierrez received a bachelor’s degree from Haverford College, and master and doctorate degrees in chemistry from Princeton University. He has more than 10 years of experience in research in the area of structural organic and oranometallic chemistry. He joined FDA in 1992 as a researcher and reviewer in the agency’s Center for Biologics Evaluation and Research, working on vaccine adjuvants and method development for determination of purity and structure of vaccine components. He first joined OIVD in 2000 as a scientific reviewer, becoming a team leader for toxicology in 2003, director of the division of chemistry and toxicology devices in 2005, and deputy director for new product evaluation in 2007.

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Abbott, GSK Collaborate to Develop Molecular Diagnostic Test

Tuesday, July 14th, 2009

Abbott has entered into an agreement with GlaxoSmithKline (GSK) to develop an automated molecular diagnostic test, based on polymerase chain reaction (PCR) technology, intended to screen non-small cell lung cancer (NSCLC) tumors for expression of the MAGE-A3 antigen. GSK’s MAGE-A3 ASCI (Antigen Specific Cancer Immunotherapy) candidate is currently being evaluated as an adjuvant treatment in resected NSCLC in the Phase III clinical study MAGRIT, the largest lung cancer treatment study ever conducted. To be eligible to receive GSK’s MAGE A3 ASCI, patients must have MAGE-A3 expressing NSCLC tumors. MAGE-A3 is a tumor-specific antigen that is expressed in non-small cell lung cancer and a wide variety of other cancers, but not in normal cells.

Under terms of the agreement, Abbott, in conjunction with GSK, will develop and commercialize a PCR test designed to detect MAGE A3 for use on the Abbott m2000 automated instrument system. Currently, there are no nucleic acid based tests approved by FDA for use in identifying patients who may derive treatment benefits from targeted non-small cell lung cancer therapies.

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Diagnostic Devices Moves Operations out of Asia

Tuesday, July 7th, 2009

Diagnostic Devices Inc. has announced the relocation of manufacturing operations from Southeast Asia to Charlotte, North Carolina.

“At a time when the economy is driving many U.S. companies to overseas production, we are taking a stand to reverse that trend and bring these jobs back to the United States,” said Rick Admani Abulhaj, chief operating officer for Diagnostic Devices. “We are proving that domestic manufacturing can be less expensive than overseas production due to cutting-edge technologies, high-tech automation, and significantly enhanced quality controls. Most importantly, this move creates jobs and wealth in our own backyards where we need it most.”

During the next 18 months, Diagnostic Devices will transfer manufacturing jobs from Southeast Asia to its 44,600-square-foot-manufacturing-and-distribution facility in Charlotte. The move will create more than 100 jobs for the Charlotte region that will consist primarily of high-tech, full-time positions.

“No other businesses I know of are doing this,” Abulhaj said. “By using innovation, automation, and science, we’ve created a win-win. For years, our business model concentrated on low-tech medical devices that previously required a large-scale labor force to manufacture, and we had no choice but to move some operations to Southeast Asia to remain competitive. But now we are able to do the reverse. By utilizing science, technology, and automation, we are bringing those jobs back to the United States while lowering our costs by 40%. This is an exciting time for our business, to provide jobs here in America and to the benefit of our community.”

By relocating these jobs to the United States, after 18 years of manufacturing experience in Southeast Asia, the company will have complete control of its intellectual property and oversight of quality control.

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