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Seeing green with a hybrid
SAN DIEGO—Diagnostic test maker Quidel Corp. has closed its acquisition of Diagnostic Hybrids Inc. for about $130 million in cash.
Based in Athens, Ohio, Diagnostic Hybrids is a market leader in manufacturing and commercializing direct fluorescent in vitro diagnostic assays used in hospital and reference laboratories for a variety of diseases, including viral respiratory infections, herpes, chlamydia and other viral infections and thyroid diseases. Diagnostic Hybrids' strategy is to leverage its antibody development and cell culture expertise to develop new products that address significant market opportunities.
"We are pleased to complete the acquisition of Diagnostic Hybrids and extend a warm welcome to its employees," says Doug Bryant, president and CEO of Quidel Corp. "Our combined company offers the marketplace a continuum of diagnostic tests for triaging patients, confirming diagnoses and providing actionable results to improve patient care. We have begun an integration that is focused on maximizing Diagnostic Hybrids' growth opportunities and expect a smooth transition."
Bryant says Diagnostic Hybrids was an ideal acquisition "because it allows Quidel to acquire products and technologies that expand our reach into synergistic markets, such as Graves' disease, cancer, herpes, adenovirus, hMPV and parainfluenza have a positive effect on both revenue and earnings, and help to reduce the seasonality of our current rapid point-of-care diagnostics business."
According to Bryant, Diagnostic Hybrids will operate as a wholly owned subsidiary of Quidel, with its R&D and manufacturing operations remaining in its Athens, Ohio, facility.
"Given the nature of the Diagnostic Hybrids business, we do not expect there to be significant changes to its existing structure or organization," he adds.
By combining the business with Diagnostic Hybrids, Bryant says the company will offer the marketplace a stronger portfolio of diagnostic tests for triaging patients, confirming diagnoses and providing actionable results to improve patient care.
Bryant notes that the combination of Quidel, a leader in rapid diagnostic testing, and Diagnostic Hybrids, a leader in direct fluorescent and culture-based tests, have complementary product offerings and can address different customer needs.
"In addition to a strong financial profile with expanding margins, Diagnostic Hybrids' product offerings complement our respiratory disease portfolio and also strengthen Quidel's position in hospitals," he says. "This acquisition diversifies our revenue base into other disease areas with unmet customer needs, adds R&D competencies and continues our investment in developing molecular diagnostic capabilities."
As a result, the acquisition also opens up new sources of business for Quidel.
"Quidel's current client base is comprised of physicians, hospitals and other urgent care centers that utilize simple, rapid diagnostic tests, whereas Diagnostic Hybrids' products are used in highly or moderately complex hospital and reference laboratories," Bryant points out. "The addition of Diagnostic Hybrids to Quidel's business expands our client base, particularly in the hospital and reference lab markets."
Bryant says that Diagnostic Hybrids has proven to be a well-run company and Quidel officials expect DHI to continue to achieve solid growth in the future.
"In addition, one of our corporate goals for 2010 is to successfully integrate our two companies," he concludes. "There are a number of factors that will define a successful integration. They include capitalizing on opportunities for collaborative R&D to build our product portfolio, expanding the number of products Diagnostic Hybrids' sales force offers to its customers, and reaching global markets with its products. We are already taking action in pursuit of this goal and I am confident this will be a successful acquisition."