Siemens becomes one of Pfizer's many companion diagnostics suitors

Siemens ($SI) will concoct diagnostic tests for some Pfizer ($PFE) drugs, the German conglomerate has disclosed.

As is the norm with these type of deals, neither side is releasing financial details. But the Siemens Clinical Laboratory in Berkeley, CA, will design and develop the tests, in what is being termed a "master agreement." It's part of the company's Siemens Healthcare Diagnostics division, which develops diagnostic tools and tests for hospitals, clinical laboratories, doctor's offices and clinics.

Pfizer isn't going exclusive, however. Munich-based Siemens is one of Pfizer's many collaborators focused on developing in vitro diagnostic tests that could eventually be paired with specific drugs under development once they hit the global market, Siemens explained.

For Siemens, the move represents a big step up in companion diagnostics development, with Siemens eyeing a rapidly growing market segment dominated by Switzerland's Roche ($RHHBY). Roche's Ventana arm, for example, is involved with more than 150 collaborative projects outside of Roche involving companion diagnostic tests. It is also heavily focused on developing such tests for its own drugs. Recently, Roche paired a companion diagnostic test linked to its Herceptin breast cancer drug with two new cancer drugs also made by the company.

Companion diagnostic tests are designed to help identify patients for whom a specific drug treatment would work best.

Trevor Hawkins, a senior vice president for Siemens Healthcare's diagnostics division, said in a statement that the partnership with New York-based Pfizer "marks a major milestone in Siemens' personalized medicine strategy."

The deal also offers a welcome distraction from other matters. In October, a U.S. judge dismissed a lawsuit filed by a former Siemens Healthcare employee who alleged he was fired after revealing a hospital kickback scheme in China. That's a clear victory for Siemens, but it comes in the wake of a 2008 settlement with U.S. and German authorities over wide-ranging international bribery charges.

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