Third-quarter 2012 Life Science Index sales grew 3.4%, 4.9% excluding currency, to $3,260 million. Operating profit improved 2.8% to $658 million. Based on continuing operations, operating margin slipped 20 basis points to 20.7% of sales.

Fiscal fourth-quarter revenue for Becton Dickinson’s BD Biosciences segment, which consists of Cell Analysis and Advanced Bioprocessing products, fell 6.3%, 0.7% excluding currency, to $273.1 million to make up 14% of company sales. US sales fell 9.2% to account for 32% of Biosciences revenue. International sales declined 4.9% but grew 3.5% excluding currency to account for 68% of segment sales. Reported operating profit slumped 17.9% to $62.1 million due to currency and one-time expenses.

Full-year revenue for BD Biosciences declined 1.5% but grew 0.7% excluding currency to $1,079.6 million. Higher sales of instruments and reagents in China were mostly offset by lower demand from pharmaceutical and biotechnology research markets and academic customer in the US. Segment sales to emerging markets grew in the double digits, while sales to developed markets declined in the low single digits. International sales grew 2.3%, 5.8% in local currency, to represent 68% of Biosciences sales. US sales fell 8.9% to make up 32%. Revenue from discontinued operations slipped 2.7% to $238.2 million. Reported full-year operating profit declined 5.9% to $261.7 million as a result of software development and acquisition-related expenses. Gross margin declined due to currency and higher raw material costs. For fiscal year 2013, BD Biosciences’ revenues are expected to grow 1%, with continued weakness in the US research markets.

Biotage’s third-quarter revenues rose 0.5% to SEK 107.1 million ($15.9 million = SEK 6.74 = $1) (see page 12), but were flat excluding currency. Consumables and service revenues expanded to account for nearly 60% of sales, including higher demand for analytical chemistry and purification products. While instrument sales declined, the company reported positive response to its new peptide synthesis systems. Overall, US and European sales accounted for 40% and 34% of revenues, respectively. Demand from Southern European markets were challenged, especially from academic customers. Sales to Japan and China grew to make up 16% and 6%, respectively. Sales to the rest of the world accounted for 4%. Excluding currency, adjusted operating profit climbed 50.1% to SEK 10.4 million ($1.5 million) and gross margin improved 250 basis points to 60.3% of sales due to product mix and direct sales channels.

Third-quarter sales for Fluidigm grew 20.6% to $12.8 million. Consumables sales climbed 56.8% to make up 46% of sales, led by strong demand for genotyping and gene expression chips. Revenue growth also advanced due to higher sales of Access Array chips and assays as well as increased analytical chip pull-through rates, but was slightly offset by lower chip pricing. Instruments revenue grew 4.9% to account for 53% of sales due to the introduction of the Single-Cell Auto Prep system, increased average unit pricing, and higher services and aftermarket products sales. The number of analytical systems shipped declined due to the timing of orders and increased competition for digital PCR products. Cumulative shipments of instruments reached more than 600 units, of which 70% are analytical systems and 30% are preparatory systems. Product sales to the US, Europe, Asia Pacific and Japan grew 28.1%, 8.6%, 11.7% and 64.0% to account for 62%, 21%, 10% and 6% of sales, respectively. Sales to Other regions tripled to make up 1%. Grant and other revenue accounted for 1% of sales. Adjusted operating loss narrowed by 3.6% to $3.9 million. Gross margin climbed 367 basis points to 72.5% of sales due to product mix as well as lower instrument material costs. The company lowered its full-year Product revenue growth forecast from 25%–30% to 24%–26% to over $50 million due to uncertainties surrounding the US federal budget.

Third-quarter sales for Merck Millipore improved 5.2%, 7.3% organically, to €642.7 million ($803.4 million = €0.80 = $1). Currency and acquisitions added 5.8% and 0.7% to sales growth, respectively. Royalty income tripled to €6 million ($7.5 million) as a result of higher royalties for the Process Solutions’ (PS) pharmaceutical chemicals products. Sales for the PS business grew 4.6% organically to make up 40% of segment sales due to increased production of biologic drugs and demand for single-use manufacturing products. Lab Solutions (LS) sales grew 1.9% organically to represent 42% of segment revenues, driven by strong demand for lab water consumables and BioMonitoring products. However, LS sales were partially offset by lower demand for laboratory chemical products. Revenue for the Bioscience business improved 2.1% organically to make up 18% of segment sales. Roughly 44% of Bioscience sales are tied to government and academic markets. Organic sales to Europe, North America, Emerging Markets and Rest of World grew 3.0%, 3.4%, 2.7% and 3.2% to account for 36%, 28%, 24% and 12% of revenues, respectively. The company reported softer demand for Bioscience products in emerging markets and for academic sales in Europe. Adjusted operating profit rose 13.2% to €123.3 million ($154.1 million). Gross profit margin rose 90 basis points to 59.0% of sales due to manufacturing improvements and currency. Full-year sales are projected to grow 9% to roughly €2,600 million ($3,312 million).

Sequenom’s third-quarter sales jumped 68.3% to $22.9 million (see page 12). Domestic sales grew 148.4% to account for 69% of sales. International revenue slipped 2.8% to make up 31%. Sales and operating results continue to be hampered by the current cash accounting methods for the MaterniT21 test. Operating loss widened by 62.8% to $29.7 million and gross margin was reduced by more than half to 26.3% of sales due to up front diagnostic testing costs. Sequenom raised its previous billing expectations for the year from 50,000 MaterniT21 tests to slightly below 60,000. Genetic Analysis sales fell 8.9% to represent 55% of revenues. Consumables sales dropped 19.0% to $5.1 million due to lowered demand from translational research and agricultural biology markets. Revenue from contract research services fell 33.1% to $0.7 million. System sales and related revenue improved 12.2% to $4.6 million as a result of higher sales and pricing of MassARRAY instruments. Genetic Analysis operating profit slumped 60.5% to $0.8 million. Sequenom’s Molecular Diagnostics (MD) revenue soared 463.4% to account for 55% of sales primarily due to collected revenue for the MaterniT21 test. The company accessioned roughly 26,000 total test samples, of which 69% were for MaterniT21 PLUS. MD operating loss widened by 45.9% to $19.8 million due to upfront diagnostic testing costs and higher personnel expenses. The company expanded its sales force by 50% to 75 employees.

 Column Chart: Quarterly Organic Sales Change

 January 2009–September 2012

 Year     Q1     Q2     Q3     Q4

 2009   3.6%   0.9%   1.9%   5.8%

 2010   9.4%   8.6%   8.8%   6.3%

 2011   5.7%   6.7%   4.6%   4.0%

 2012   2.3%   3.3%   4.9%

 Column Chart: Quarterly Operating Profit Margins

 January 2009–September 2012

 Year      Q1      Q2      Q3      Q4

 2009   19.1%   20.2%   21.4%   22.9%

 2010   22.1%   22.6%   22.3%   23.0%

 2011   22.1%   21.1%   21.3%   22.9%

 2012   21.3%   20.4%   20.7%

 Life Science Index              

                                 2009     2010      2011     2012     2009–10    2010–11     2011–12

 Total Annual Revenues ($M)   $11,268  $12,189   $13,009    -----        8.2%       6.7%       -----

 Annual Oper. Profits ($M)     $2,321   $2,673    $2,820    -----       15.1%       5.5%       -----

 3rd Quarter Revenues ($M)     $2,748   $2,952    $3,152   $3,260        7.4%       6.8%        3.4%

 3rd Quarter Oper. Profits ($M)  $565     $629      $640     $658       11.2%       1.8%        2.8%