Healthcare Industry News: Applera Corporation
News Release - September 20, 2007
Celera to Acquire Atria GeneticsAcquisition Complements Celera's Existing Molecular Diagnostics Portfolio and Provides High Margin Products
ROCKVILLE, Md. & ALAMEDA, Calif.--(HSMN NewsFeed)--Celera (NYSE:CRA ), an Applera Corporation business, and South San Francisco-based Atria Genetics, Inc., a privately held company, today announced they have signed a definitive agreement whereby Celera will acquire substantially all of the assets of Atria for approximately $33 million in cash. Atria has a line of human leukocyte antigen (HLA) testing products that are used for identifying potential donors in the matching process for bone marrow transplantation. The transaction is subject to customary closing conditions and is expected to close during the second quarter of Celera's fiscal 2008.
Atria participates in the estimated $175 million HLA market, of which approximately 20 percent is in bone marrow transplantation and the bone marrow registry. The remaining approximate 80 percent is in solid organ matching. Since January 2004, Atria's current HLA sequencing-based typing products have been marketed and distributed worldwide by Abbott Molecular through its alliance with Celera. These revenues have been included in the end-user revenues reported by Celera, although Celera currently receives a low single digit percentage royalty on these revenues as these products are not part of the profit or loss arrangement within the Abbott alliance. With this acquisition, Celera will retain 60 percent of these end-user revenues under the current distribution agreement with Abbott, and will also continue to receive a low single digit percentage royalty on the total end-user revenues, as described above. Fiscal 2006 end-user revenues for the Atria products were approximately $12 million, which grew approximately 10 percent over the prior year. Atria has been profitable since 2003.
Celera currently anticipates that this acquisition will be accretive to earnings in the second half of fiscal 2008, excluding the impact of acquisition-related intangible amortization and transaction and integration expenses. The exact amount of accretion will only be known after the completion of an analysis of the allocation of the purchase price. Atria has 13 employees, all of whom are expected to be integrated into Celera.
"This acquisition gives us direct access to this important niche market area of tissue typing in transplantation and the bone marrow registry markets," said Kathy Ordonez, president of Celera. "Importantly, this is expected to contribute to Celera's objective of providing high margin products with accretive value in a market that is complementary to ours. Additionally, this acquisition has a strong strategic fit enabling our horizontal expansion as we look to exploit the potential for this product line in next generation sequencing."
"We're excited about the opportunity to integrate Celera's molecular expertise with our success in HLA testing," said Pete Krausa, Ph.D., president of Atria Genetics. "Celera brings added expertise and resources that will help us expand and accelerate the development of new products and services for the immunogenetics and autoimmunity fields."
About HLA genes and proteins
The HLA proteins are integral to the function of the immune system and are located on the surface of white blood cells and other tissues in the body. There are two main classes of HLA genes, class I (including HLA-A, HLA-B and HLA-C) and class II (HLA-DR, HLA-DP and HLA-DQ). These genes are extremely variable, and DNA sequencing represents the "gold standard" of genetic analysis. HLA testing, also referred to as tissue typing, is a key component in determining the compatibility between potential donors and recipients prior to transplantation to maximize the chances of graft survival and minimize serious immunologic transplant complications. The better the match of HLA types, the higher the likelihood of a successful transplant. In addition to transplantation related applications, knowledge of an individual's HLA type is also relevant to infectious disease progression, autoimmune disorders, as well as certain pharmacogenomic situations.
About Applera Corporation and Celera
Applera Corporation consists of two operating groups. Celera is primarily a molecular diagnostics business that is using proprietary genomics and proteomics discovery platforms to identify and validate novel diagnostic markers, and is developing diagnostic products based on these markers as well as other known markers. Celera maintains a strategic alliance with Abbott for the development and commercialization of molecular, or nucleic acid-based, diagnostic products, and it is also developing new diagnostic products outside of this alliance. Through its genomics and proteomics research efforts, Celera is also discovering and validating therapeutic targets, and it is seeking strategic partnerships to develop therapeutic products based on these discovered targets. The Applied Biosystems Group serves the life science industry and research community by developing and marketing instrument-based systems, consumables, software, and services. Customers use these tools to analyze nucleic acids (DNA and RNA), small molecules, and proteins to make scientific discoveries and develop new pharmaceuticals. Applied Biosystems' products also serve the needs of some markets outside of life science research, which we refer to as "applied markets," such as the fields of: human identity testing (forensic and paternity testing); biosecurity, which refers to products needed in response to the threat of biological terrorism and other malicious, accidental, and natural biological dangers; and quality and safety testing, such as testing required for food and pharmaceutical manufacturing. Applied Biosystems is headquartered in Foster City, CA, and reported sales of nearly $2.1 billion during fiscal 2007. Information about Applera Corporation, including reports and other information filed by the company with the Securities and Exchange Commission, is available at http://www.applera.com, or by telephoning 800.762.6923. Information about Celera is available at http://www.celera.com.
Certain statements in this press release are forward-looking. These may be identified by the use of forward-looking words or phrases such as "believe," "expect," "should," "anticipate," and "intend," among others. These forward-looking statements are based on Applera Corporation's current expectations. The Private Securities Litigation Reform Act of 1995 provides a "safe harbor" for such forward-looking statements. In order to comply with the terms of the safe harbor, Applera Corporation notes that a variety of factors could cause actual results and experience to differ materially from the anticipated results or other expectations expressed in such forward-looking statements. These risks and uncertainties include but are not limited to: (1) failure of the transaction to close when anticipated, or at all, due to the failure to obtain necessary approvals or the inability to obtain such approvals as rapidly as anticipated; (2) risks associated with integrating Atria's products, people, and systems into Celera's; (3) failure to achieve revenue and cost synergies anticipated to result from the acquisition; (4) Celera is using novel and unproven methods to discover markers for the development of new diagnostic products, which may not be successful; (5) the diagnostic industry is very competitive, and new diagnostic products may not be accepted and adopted by the market; (6) demand for diagnostic products may be adversely affected if users of these products cannot receive adequate reimbursement for these products from third party payors such as private insurance companies and government insurance plans; and (7) other factors that might be described from time to time in Applera Corporation's filings with the Securities and Exchange Commission. All information in this press release is as of the date of the release, and Applera does not undertake any duty to update this information, including any forward-looking statements, unless required by law.
Copyright 2007 Applera Corporation. All Rights Reserved. Celera is a registered trademark and Applied Biosystems and Applera are trademarks of Applera Corporation or its subsidiaries in the U.S. and/or certain other countries.
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