Follow the Biotech Money … If You Can Find It

Posted by Pete Shanks on January 9th, 2013

In spite of an end-of-year flurry of deals, last year was relatively slow for mergers and acquisitions in the genomics and related sectors, according to GenomeWeb, and this year may not be much more active. This seems to be because technology is in something of a holding pattern. There are hopes of the "$1 million medicine" but for the moment that only applies to very small niche markets; widespread gene therapies remain distant prospects, and even genomic sequencing is in a phase of "incremental" advances. Still, some recent moves are worth noting.

Illumina, the genomic sequencing and analysis company, was at the center of several stories. Roche, the Swiss pharmaceutical giant, tried to buy Illumina for $6.7 billion, but eventually backed out, saying the company was "not willing to abandon the totally unrealistic price they were asking for." Besides, there are "several alternatives to get hold of gene-sequencing technology," so Roche could yet make waves in the field.

Meanwhile, Illumina bought Verinata Health for $350 million, which could rise to $450 million. That gives them rights to the verifiฎ non-invasive prenatal test, which detects Down syndrome and two other trisomies, and is being expanded to cover Turner and Klinefelter syndromes, among others. Presumably more R&D funds will be available for the product, though some analysts are skeptical about the synergies available in the short term.

In other news related to testing, Amgen bought DeCODE Genetics for $415 million, but discontinued its direct-to-consumer (DTC) division, DeCODEme. This is good news for 23andMe, which almost simultaneously raised $50 million in new financing, with the goal of increasing the number of customers in its database from 180,000 to a million. The money came from current investors, including Google, and Russian Internet billionaire Yuri Milner.

China's BGI-Shenzhen made headlines with a $118 million bid for Complete Genomics, which is based in Mountain View, CA. This caused some fretting, partly inspired by Illumina, about U.S. interests and possible damage to U.S. businesses, but the deal has passed both national security and antitrust review. At that point, Illumina withdrew its counter bid.

On a much smaller scale, Geron finally managed to find a buyer for its embryonic stem cell (ESC) technology. That is BioTime Acquisition Corporation (BAC), a subsidiary of BioTime, which was founded by Michael West, who founded both Geron and Advanced Cell Technology, and seems to be developing a network of businesses. BAC is run by Thomas Okarma, the former CEO of Geron, and a long-time advocate for the ESC trials, which were cancelled after he was fired. This deal is basically funded by a $10 million investment from an unnamed private investor (someone seems to know who), half of it rolled through BioTime and half put straight into BAC, in which Geron also keeps an interest.

West's talents may be wasted on these little deals; what could the man do with a few billion to play with?

Previously on Biopolitical Times:

Posted in Biotech & Pharma, Personal genomics, Pete Shanks's Blog Posts, Sequencing & Genomics


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