Qiagen ($QGEN) snatched up AmniSure International this week as the company continued to beef up its diagnostic offerings through acquisitions. AmniSure, a privately held company based in Boston, is known for marketing a point-of-care diagnostic that determines if a pregnant woman is suffering from a rupture of fetal membranes.
Neither side disclosed financial terms. But Qiagen revealed that the deal closed this month, and AmniSure is now a subsidiary of the Dutch conglomerate. And in a sign of AmniSure's initial value, Qiagen said it would contribute $12 million to the company's earnings for the rest of this year, and about $24 million in 2013. The company also plans to combine AmniSure's global sales team with Qiagen's own, in order to propel further sales growth domestically and overseas.
What Qiagen gets is an FDA-cleared, one-step minimally invasive test used to detect small amounts of amniotic fluid in vaginal discharge, and results generate within a couple of minutes. There is a huge market need, with as many as 30% of pregnant women checked for the condition in their second or third trimesters, Qiagen said. Up to 10% of pregnant women actually develop rupture of fetal membranes, which leads to complications such as infections in both the mother and child, before and after birth. A selling point here is that the AmniSure test is considered highly accurate. Many tests for the rupture of fetal membranes can generate higher rates of false positives, which lead to unneeded hospital admissions, unnecessary induced labor and expensive medications that aren't actually required, Qiagen explains.
Also crucial: The test will generate a steady income stream because, as the company notes, most U.S. state Medicaid plans will reimburse it. And so AmniSure becomes a nifty addition to the company's "point-of-need" group of tests. One thing to watch, however: Qiagen said it will take a one-time $5 million charge relating to "restructuring efforts and integration activities" stemming from the deal. The company hasn't commented yet, but "restructuring" can often be a corporate word for job cuts.
Qiagen just completed a pretty successful first quarter, generating double-digit growth in sales and net income. An M&A focus on molecular diagnostics and robust sales for diagnostic test kits drove the robust numbers.
- read the release