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From Dark Daily...
Roche Fuels the Digital Pathology "Gold Rush" by Paying $100 Million to Acquire BioImagene
August 24, 2010
Hefty purchase price sends message to pathologists and clinical laboratory executives
For any pathologist still harboring doubts about the future of digital pathology, yesterday's surprise news that Roche Holding AG (VTX:ROG.VX) will pay $100 million to acquire BioImagene, Inc., provides compelling evidence that the digital pathology marketplace is ready for prime time.
Roche announced that it will pay $100 million to buy privately-held BioImagene of Sunnyvale, California. The purchase will be handled by Roche's Ventana Medical Systems, Inc., and the deal is expected to close in just a few weeks. After the acquisition, BioImagene will operate as part of Ventana. BioImagene has emerged as one of the early leaders in selling digital scanners and digital pathology systems.
In the field of anatomic pathology, Roche has made some bold moves. Pathologists and clinical laboratory managers will remember that the Swiss pharmaceutical giant aggressively pursued Ventana Medical Systems for many months in the second half of 2007. Roche surprised investors by its willingness to pay $3.4 billion for Ventana, which had annual revenues of about $290 million at the time. Roche's persistence was rewarded when it closed on its purchase of Ventana Medical Systems in early 2008.
Now Roche is paying $100 million to acquire a fledgling digital pathology company. With its purchase, Roche will not only get the digital scanner products and digital pathology systems, but it will also get BioImagene's intellectual property and patents that are incorporated into these digital pathology products.
Roche is now poised to develop an integrated suite of products for the processing and analysis of tissue specimens. Such a suite would start with the products sold by Ventana Medical Systems. It offers automated histology systems, along with some diagnostic test kits. Ventana is also developing a variety of biomarkers for use in diagnostic tests. Some of these biomarkers are expected to be companion diagnostic assays for certain of Roche's therapeutic drugs which are in class III and IV trials.
Now Roche will have BioImagene's digital pathology systems to mate with the molecular diagnostic assays and genetic tests that are developed and sold by Ventana. Roche will be able to develop diagnostic algorithms built within the BioImagene digital pathology systems that are "tuned" to the molecular test kits developed and sold by Ventana.
Thus, Roche may be on a path that allows it to develop and market a combination of tissue processing solutions, FDA-cleared molecular diagnostic kits mated to a digital pathology system with FDA-cleared diagnostic algorithms specifically developed to support the Ventana assays. Such an integrated suite of anatomic pathology products would be unique in the marketplace.
This approach was discussed by Ventana Medical Systems President Hany Massurany. In the press release about the BioImagene acquisition, Massurany stated that "…with BioImagene's current and future products, we will be able to deliver an end-to-end solution from automated staining to comprehensive patient reports."
This strategy may go one step further. Roche may be creating its own development pipeline that will produce companion diagnostic assays tailored to accurately predict a patient's response to its specific therapeutic drugs. Because it controlled the development of these assays—and possibly pursues FDA clearance—it might reduce the variability in tissue processing and professional diagnosis that is recognized to exist across many of the clinical pathology laboratories in this country and other developed countries.
Roche is one of the world's largest pharmaceutical companies. It is also the world's largest in vitro diagnostic (IVD) manufacturer. Thus, its entry into the digital pathology marketplace through its acquisition of BioImagene represents a major bet that digital pathology will play an important role in the future of anatomic pathology and tissue-based diagnostics.
Pathology and clinical laboratory managers who are closely interested in development in digital pathology products remember that, as of today, probably fewer than 1,000 digital pathology systems are currently installed and operating in labs across the globe. Digital pathology is still a technology and a clinical opportunity that is in its infancy.
Going forward, it will be first-mover and early-adopter pathology groups which prove more willing to invest the capital and management resources to acquire and employ digital pathology solutions. This is already true of academic centers and regional pathology super-groups.
Pathology groups interested in keeping up with the growth of the digital pathology marketplace may want to consider even the simple step of acquiring digital slide scanning capability. That can be a simple first step to gain experience with the technology and how it can be used to advance clinical care.
Roche Fuels the Digital Pathology "Gold Rush" by Paying $100 Million to Acquire BioImagene
August 24, 2010
Hefty purchase price sends message to pathologists and clinical laboratory executives
For any pathologist still harboring doubts about the future of digital pathology, yesterday's surprise news that Roche Holding AG (VTX:ROG.VX) will pay $100 million to acquire BioImagene, Inc., provides compelling evidence that the digital pathology marketplace is ready for prime time.
Roche announced that it will pay $100 million to buy privately-held BioImagene of Sunnyvale, California. The purchase will be handled by Roche's Ventana Medical Systems, Inc., and the deal is expected to close in just a few weeks. After the acquisition, BioImagene will operate as part of Ventana. BioImagene has emerged as one of the early leaders in selling digital scanners and digital pathology systems.
In the field of anatomic pathology, Roche has made some bold moves. Pathologists and clinical laboratory managers will remember that the Swiss pharmaceutical giant aggressively pursued Ventana Medical Systems for many months in the second half of 2007. Roche surprised investors by its willingness to pay $3.4 billion for Ventana, which had annual revenues of about $290 million at the time. Roche's persistence was rewarded when it closed on its purchase of Ventana Medical Systems in early 2008.
Now Roche is paying $100 million to acquire a fledgling digital pathology company. With its purchase, Roche will not only get the digital scanner products and digital pathology systems, but it will also get BioImagene's intellectual property and patents that are incorporated into these digital pathology products.
Roche is now poised to develop an integrated suite of products for the processing and analysis of tissue specimens. Such a suite would start with the products sold by Ventana Medical Systems. It offers automated histology systems, along with some diagnostic test kits. Ventana is also developing a variety of biomarkers for use in diagnostic tests. Some of these biomarkers are expected to be companion diagnostic assays for certain of Roche's therapeutic drugs which are in class III and IV trials.
Now Roche will have BioImagene's digital pathology systems to mate with the molecular diagnostic assays and genetic tests that are developed and sold by Ventana. Roche will be able to develop diagnostic algorithms built within the BioImagene digital pathology systems that are "tuned" to the molecular test kits developed and sold by Ventana.
Thus, Roche may be on a path that allows it to develop and market a combination of tissue processing solutions, FDA-cleared molecular diagnostic kits mated to a digital pathology system with FDA-cleared diagnostic algorithms specifically developed to support the Ventana assays. Such an integrated suite of anatomic pathology products would be unique in the marketplace.
This approach was discussed by Ventana Medical Systems President Hany Massurany. In the press release about the BioImagene acquisition, Massurany stated that "…with BioImagene's current and future products, we will be able to deliver an end-to-end solution from automated staining to comprehensive patient reports."
This strategy may go one step further. Roche may be creating its own development pipeline that will produce companion diagnostic assays tailored to accurately predict a patient's response to its specific therapeutic drugs. Because it controlled the development of these assays—and possibly pursues FDA clearance—it might reduce the variability in tissue processing and professional diagnosis that is recognized to exist across many of the clinical pathology laboratories in this country and other developed countries.
Roche is one of the world's largest pharmaceutical companies. It is also the world's largest in vitro diagnostic (IVD) manufacturer. Thus, its entry into the digital pathology marketplace through its acquisition of BioImagene represents a major bet that digital pathology will play an important role in the future of anatomic pathology and tissue-based diagnostics.
Pathology and clinical laboratory managers who are closely interested in development in digital pathology products remember that, as of today, probably fewer than 1,000 digital pathology systems are currently installed and operating in labs across the globe. Digital pathology is still a technology and a clinical opportunity that is in its infancy.
Going forward, it will be first-mover and early-adopter pathology groups which prove more willing to invest the capital and management resources to acquire and employ digital pathology solutions. This is already true of academic centers and regional pathology super-groups.
Pathology groups interested in keeping up with the growth of the digital pathology marketplace may want to consider even the simple step of acquiring digital slide scanning capability. That can be a simple first step to gain experience with the technology and how it can be used to advance clinical care.
