Second-quarter 2011 IBO Life Science Index sales grew 3.1%, 3.2% excluding currency, to $3,326 million. Operating profit expanded 0.6% to $694 million. Based on continuing operations, operating margin slipped 30 basis points to 18.5% of sales.

Fiscal third-quarter revenue for Becton Dickinson’s BD Biosciences division declined 2.7% but grew 0.2% excluding currency to $268.2 million to make up 14% of company sales. Following the proposed agreement to sell its Discover Labware unit excluding the Advanced Bioprocessing platform (see IBO 4/15/12), BD Biosciences sales are now comprised of the Cell Analysis unit and the Advanced Bioprocessing platform. Quarterly BD Biosciences sales were negatively impacted by lower research funding, especially for pharmaceutical, biotechnology and academic markets in the US. Sales to the US fell 6.4% to represent 34% of BD Biosciences sales due to lower demand for high-end Cell Analysis systems and increased competition for sales of research reagents. International sales slipped 0.7% but improved 3.8% excluding currency to make up 66%. The favorable timing of delayed orders in the previous year reduced International sales growth by 2.4%. Adjusted BD Biosciences operating income grew 4.2% to $67.2 million as a result of currency and lower R&D expenses. Sales for the discontinued Discovery Labware unit declined 3.3% to $60.3 million.

Biotage’s second-quarter revenues jumped 24.0%, 15% excluding currency, to SEK 122.3 million ($17.6 million = SEK 6.95 = $1) (see page 12). Organic sales growth was driven by strong demand for purification products and sample preparation products for analytical chemistry. Sales of synthesis products were mixed, as higher sales of peptide synthesis products were offset by slower growth of traditional synthesis products. Demand for evaporation products contracted. Overall, combined service and consumables sales accounted for 59% of revenues. Sales to the Americas, the EU, Japan, China and Rest of the World increased to account for 38%, 31%, 20%, 5% and 6% of sales, respectively. Following a significant decline a year ago, operating profit soared more than seven fold to SEK 12.9 million ($1.9 million). Gross margin fell 110 basis points to 57.6% of sales due to increased investments in China and Latin America.

Second-quarter sales for Fluidigm grew 22.4% to $12.9 million. Product sales climbed 31.5% to account for 99% of revenues. Grant revenue grew 48.6% to make up 1% of sales. License and Collaboration revenue was not material. Consumables sales soared 79.1% to $5.9 million, led by strong demand for production genotyping chips. Sales of gene expression and Access Array chips, and assays also expanded. Instruments revenue improved 7.2% to $6.9 million, driven by increased shipments of the higher-priced BioMark HD system, but was partially offset by lower sales of Access Array systems. Cumulative shipments of analytical instruments have reached more than 400 units. Instruments sales also benefited from increased service revenue and sales of aftermarket products. Product sales to the US, Europe, Asia Pacific and Other grew 25.9%, 18.0, 203.0% and 121.1% to account for 51%, 22%, 16% and 3% of sales, respectively. Japanese sales declined 22.5% to make up 8%. Adjusted operating loss widened by 20.0% to $4.4 million due to higher personnel expenses. The company maintained its full-year Product revenue growth forecast of 25%–30% to $51–$53 million. Grant revenue is expected to total $0.6 million.

In the second quarter, Merck Millipore sales grew 11.4%, 3.2% organically, to €649.5 million ($832.7 million = €0.78 = $1). Acquisitions and currency contributed 2.2% and 6.0% to revenue growth, respectively. Royalty, license and commission income, which increased nearly tenfold, added €5.8 million ($7.4 million) to total Millipore revenue. Sales growth was driven primarily by the Process Solutions (PS) and Lab Solutions (LS) business units, which accounted for 40% and 42% of division sales, respectively. Increased demand for biomonitoring products and higher sales of water consumables and services lifted LS sales. Sales for the PS business benefited from increased demand from biopharmaceutical customers, as well as higher sales of single-use manufacturing technologies, biosafety solutions and process systems hardware. Sales for the PS unit were partially offset by more than €7 million ($9 million) due to a discontinued insulin contract. Organic Bioscience sales were also higher to represent 18% of segment sales, led by increase sales of protein detection solutions and separation products in Asia. Organic sales to Europe, Emerging Markets and Rest of the World grew 0.4%, 9.8% and 10.7% to account for 37%, 24% and 12% of Millipore sales, respectively. Within Europe, demand from biopharmaceutical customers was flat; instrument sales declined but were offset by higher sales of consumables. North American sales declined 1.6% organically to make up 27% due to weak demand from academic customers. Adjusted EBIT climbed 20.2% to €72.0 million ($92.3 million). Gross profit margin improved 270 basis points to 59.3% of segment sales as a result of enhanced operating efficiency and increased pricing.

Sequenom’s second-quarter revenues climbed 36.9% to $18.3 million (see page 12). Adjusted operating income widened by 41.4% to $29.6 million as a result of added sales and marketing personnel. Gross profit margin fell by more than half to 32.2% of sales due to higher test volume and timing of cash receipts. Genetic Analysis (GA) segment sales declined 13.5% to represent 56% of revenues due to weaker system and consumables sales. GA operating profit fell 83.6% to $0.7 million. Molecular Diagnostics (MD) revenue jumped 406.6% to account for 44% of sales due to strong demand for the MaterniT21 PLUS test, which received more than 13,000 orders during the quarter. Sustained demand for cystic fibrosis tests also contributed to segment revenue growth. MD operating loss widened by 49.1% to $13.4 million. The company raised the projected full-year number of MaterniT21 tests accessioned by 44% to 65,000. Sequenom also raised the projected number of billed MaterniT21 tests by 25% to 50,000 in 2012.

Tecan’s half-year sales improved 0.2%, 0.3% in local currencies, to CHF 182.2 million ($195.9 = CHF 0.93 = $1). Sales were driven by strong demand for consumables, which grew 18.4% in local currency to account for 10% of sales. Orders fell 8.4% in local currency to CHF 179.6 million ($193.1 million) primarily due to advanced orders received at the end of 2011 within the Partnering business. Operating profit grew 6.3% to CHF 22.1 million ($23.8) due to lower R&D and administrative expenses. Despite higher pricing and lower material costs, gross profit slipped 30 basis points to 49.6% due to product mix. Excluding currency, North American and Asian sales grew 9.2% and 29.9% to make up 41% and 12% of sales, respectively. Sales to Europe and Others fell 11.6% and 4.8% in local currency to account for 44% and 3% of sales, respectively. The company maintained its full-year currency-neutral sales forecast of low to mid-single digit growth.

Revenue for Tecan’s Partnering business expanded 2.3%, 2.1% in local currency, to represent 45% of sales. Within the OEM business, demand for components, services and consumables was strong, while instrument sales were slightly higher. Partnering operating profit fell 9.0% to CHF 21.3 million ($22.9 million) due to several development programs. Life Sciences (LS) revenue contracted 1.4%, 1.1% in local currency, to represent 55% of sales. Liquid-handling sales declined despite good growth in Asia Pacific, but demand for detection instruments improved. Orders for the LS segment were slightly lower than a year ago. Segment operating income rose 91.7% to CHF 4.6 million ($4.9 million).

 Column Chart: Quarterly Organic Sales Change January 2009—June 2012

           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%    3.2%

 Column Chart: Quarterly Operating Profit Margins January 2009—June 2012

            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%    21.4%    22.9%

 2012    22.2%    18.5%

 Life Science Index              

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

 Total Annual Revenues ($M)     $11,268    $12,189    $13,008     -----        8.2%        6.7%         -----

 Annual Oper. Profits ($M)       $2,321     $2,673     $2,821     -----       15.1%        5.5%         -----

 2nd Quarter Revenues ($M)       $2,713     $2,939     $3,225    $3,326        8.3%        9.7%          3.1%

 2nd Quarter Oper. Profits ($M)    $534       $640       $690      $694       20.0%        7.7%          0.6%