Growth and Acquisitions
That same month, Bio-Techne also announced the pending acquisition of two companies, signaling the start of an aggressive expansion program.
Shanghai PrimeGene Bio-Tech, known as PrimeGene, is one of those companies. PrimeGene is a market leader in China, developing and manufacturing recombinant proteins for research and diagnostics applications. The pending PrimeGene acquisition, expected to be complete by the end of the year, is particularly strategic. As the companies have complementary products and share many customers, the acquisition will enhance value to its customers while expanding Bio-Techne’s access to the China market.
The acquisition also is a key element of Bio-Techne’s global product stratification plan that will support Bio-Techne’s two main categories of users. As Kummeth elaborates, “R&D Systems is the primary brand for scientists in biopharma and academia. We have the highest purity, bioactivity, and quality in the industry and, hence, the highest prices.” Yet, many researchers, particularly in academia, are facing funding pressures that force them to choose between high quality and low prices. Often, price wins.
Acquiring PrimeGene will enable Bio-Techne to gain manufacturing capabilities in China and allow it to offer products to meet the needs of price-sensitive customers along with expanding its China market. Kummeth notes that PrimeGene, which has “some 400 proteins and a very good research and development program,” will be positioned as “China for China” and also as a “global fighter brand.”
“Many of our commodity products will be rebranded as PrimeGene,” adds Kummeth. For these products, limited performance specifications will be provided, allowing for lower price offerings. Meanwhile, R&D Systems will continue to focus on making products with higher purity and bioactivity. Kummeth asserts there are no plans to shift R&D Systems’ manufacturing to China.
In April, Techne announced a $10 million equity investment in biochemical-test maker CyVek. Techne, which also committed to buying the company provided certain sales milestones are met, expects CyVek’s CyPlex™ immunoassay technology to enhance Bio-Techne’s platform.
CyPlex is “a new instrument we can use to leverage our reagents and assays for next-generation ELISA-like assays,” Kummeth reveals. “We will continue to provide a variety of multiplex solutions to our customers, from screening arrays to Luminex-technology-based products to high-performance quantitative multiplex solutions via the CyVek technology.” The objective is to provide choice as customer needs change during the experimental process.
CyPlex immunoassay technology combines a microfluidic cartridge with a state-of-the-art analyzer to create an efficient, automated benchtop immunoassay system that works with small sample volumes and circumvents some of the limitations of traditional multiplex systems. It provides “sample-to-answer” results in a sealed, disposable device. CyPlex will focus, at least initially, on translational research.
This pending acquisition is part of a long-term strategy to transform Bio-Techne from a reagent supplier to an applied-markets solutions provider. Going forward, acquisitions will continue to play a significant role in the growth of Bio-Techne, according to Kummeth. “We are hunting full-time for acquisitions by region and by platform. We want to broaden our antibody portfolio, and this should dovetail nicely into in vitro and companion diagnostics.” Currently, Bio-Techne offers 24,000 products and 14,000 antibodies. “That’s a good place to be, but the antibody offerings are not as broad as we would like.”