Roche shells out up to $425M for superbug testing outfit

Roche ($RHHBY) is snatching up microbiology diagnostics outfit GeneWEAVE BioSciences for up to $425 million, bolstering its offerings for drug-resistant bacteria testing amid superbug outbreaks and a growing number of hospital-acquired infections.

Under the terms of the deal, Roche will pay GeneWEAVE shareholders $190 million upfront and up to $235 million in milestone payments, the company said in a statement. When all is said and done, Los Gatos, CA-based GeneWEAVE will become a part of Roche's Molecular Diagnostics unit.

Through the acquisition, Roche will get its hands on GeneWEAVE's Smarticles technology, a set of products that can quickly pinpoint multidrug-resistant organisms (MDROs) and look at antibiotic susceptibility from clinical samples, all without traditional culture or sample prep. GeneWEAVE's vivoDx system, its first product in development, is a fully-automated system that helps labs detect MDROs and develop guidelines for antibiotic therapy. The technology is being tested at multiple sites in the U.S., Roche said in a statement.

Roland Diggelmann, COO of Roche Diagnostics Global--Courtesy of Roche

"With GeneWEAVE, we further strengthen our microbiology diagnostics offerings with cutting-edge technology that will aid in the fight against drug-resistant bacteria," Roland Diggelmann, COO of Roche Diagnostics, said in a statement. "This technology has the potential to provide healthcare professionals access to quick and accurate diagnoses that can lead to rapid, informed treatment decisions."

The deal marks a turning point for Roche, which has been steadily building its diagnostic offerings for drug-resistant bacteria and healthcare-associated infections. In January, the company got an FDA greenlight for its drug-resistant MRSA/SA test, adding to its testing menu for its cobas 4800 system. In May, the diagnostics heavyweight got an FDA OK for its rapid C. difficile test, which screens for the bacteria's gene in stool samples.

But Roche is not the only company targeting the drug-resistant bacteria testing market. Last year, Dutch diagnostics giant Qiagen ($QGEN) won European clearance for three of its tests for bacterial infections. And microbial genetics analysis company OpGen is hard at work on its products, which help identify hospital patients who are infected with MDROs.

- read Roche's statement
- here's the Reuters story

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