Novo's investment arm gains toehold in diagnostics with £400M deal for testing supplier BBI

Even though the demand for COVID-19 testing may have passed its peak, the global need for diagnostics in preventive and routine care continues to grow—and now Novo Holdings wants to become further entrenched in the space. 

Novo Holdings, the life science investment arm of Novo Nordisk's overarching foundation, is picking up the U.K.-based BBI Group for an enterprise value of more than £400 million, or $563 million U.S. With the acquisition, it will gain one of the world’s larger producers of diagnostic reagents and supplies for other test makers.

With sites in seven countries and 400 employees, BBI counts Thermo Fisher Scientific, Merck and Siemens among its customers. It provides development and manufacturing services for custom antibodies, immunoassays, gold nanoparticles, lateral flow tests and point-of-care antigen diagnostics.

BBI also offers its Novarum diagnostic app platform, which employs smartphones to read tests and share the results. The CE-marked program was tapped by the U.K. Rapid Test Consortium to provide a digital method for COVID testing certificates.

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Separately, the diabetes-focused Novo Nordisk has dabbled in testing, with an oral diagnostic agent for growth hormone deficiency, plus an additional use for its GlucaGen injection in imaging scans of the gastrointestinal tract. Over the past year, the drugmaker has also helped its home country of Denmark scale up coronavirus testing capacity and developed an antibody test used by researchers at the University of Copenhagen.

Now Novo Holdings, with its portfolio of more than 120 life science companies, will serve as BBI’s majority shareholder. In 2015, BBI was carved out of Alere in a $164 million sale to Exponent Private Equity, before Alere’s own multibillion-dollar acquisition by Abbott in 2017.

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"In the last five years, we have grown revenues and profitability considerably through investing in our products and services, people and world-class infrastructure,” BBI Group CEO Mario Gualano said in a statement

That includes expanding the company’s presence in the U.S. and establishing legal operations in China while seeing its business grow by about 22% annually between 2017 and 2020. BBI will continue to be headquartered in the south of Wales.