Nanogen changing gears

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SAN DIEGO—Proving that there is life after layoffs, Nanogen Inc. a developer of molecular-biology and rapid diagnostic products, and Thermo Fisher Scientific Inc. have entered into an agreement in which Thermo Fisher will be the exclusive provider of a variety of products used in gene-expression experiments. These products are based on Nanogen's second generation proprietary probe technology for real-time PCR applications, the most widely used method for the amplification and measurement of DNA and RNA for molecular diagnostics and life science research.
SAN DIEGO—Just days after announcing that it was looking into options for dealing with its microarray business and becoming more firmly ensconced in the clinical diagnostics marketplace, Nanogen announced staffing cuts that will see 13 people (4% of staff) from the microarray division lose their jobs. The company expects severance-related expenses of $335,000.
"In the past year, we have begun to build a solid business with our real-time PCR products and point-of-care rapid testing solutions," says David Ludvigson, Nanogen president and COO, about the decision to re-examine the company's direction. "By focusing on these businesses, we expect to significantly grow our presence in the diagnostics market and improve our business performance.  We hold significant intellectual property in the molecular and point-of-care areas and intend to continue developing proprietary, technology based products that add value in the clinical diagnostic market and are well accepted by customers."
While the absolute numbers are small in the biotechnology sector, the move may prove a bellwether for a changing market landscape. A February 2007 report by Kalorama Information suggests that the global market for all molecular diagnostics technologies could surpass $60 billion by 2016.
"As each molecular diagnostic moves from a specialized technology of limited use to a mainstream activity in the clinical laboratory once its relevance and role in the treatment of disease are established, the use of these tests should become more of the norm in the global market," says Dr. Kenneth G. Krul, report author. "Keeping in mind that for each new assay developed there may be multiple clinical and non-clinical applications provides developers with greater opportunity for growth and return on their investment."

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