Fourth-quarter 2009 IBO Life Science Index sales rose 10.7% to $2,747.35 million, including 5% growth from currency transactions. Operating profit soared 20.3% to $550.05 million. Operating margins climbed 160 basis points to 20.0% of revenues. For the year, Index sales grew 2.1% to $9,683.69 million, including a 2% decline from currency. Operating profit grew 10.3% to $1,738.52 million. Operating margins rose 140 basis points to 18.0% of sales. Several companies recorded strong organic fourth-quarter growth, while others reported improvements within particular business units.

Fiscal first-quarter revenue for Becton Dickinson and Company’s BD Biosciences unit was flat (see page 12), but grew 1% on a currency-neutral basis to $302.7 million to represent 16% of company sales. US sales fell 2.7% to account for 37% of segment revenue. International revenue grew 1.7%, 2.5% at constant exchange rates. Discovery Labware revenue slipped 2.3%, 2.1% on a currency-neutral basis, to account for 24% of segment revenue, while Cell Analysis sales improved 0.8%, 1.3% on a currency-neutral basis, to make up 76%. Discovery Labware sales fell due to inventory reductions by a distributor, delayed orders of bioprocessing products and year-over-year comparisons. BD Biosciences’ operating income slumped 14.3% to $85.5 million due to exchange rates.

Fourth-quarter sales for Biotage AB fell 8.7%, 5% at constant-exchange rates, to SEK 99.5 million ($14.2 million = SEK 7.01 = $1) from SEK 109.0 ($14.0 million = SEK 7.80 = $1) (see page 12). Sales to the EU area, US and Rest of the World accounted for 40%, 39% and 21% of revenues, respectively. Adjusted operating profit was SEK 0.4 million ($0.1 million), compared to SEK $15.0 million ($1.9 million) a year ago. Gross margins fell 330 basis points to 54.1% of sales due to instrument pricing competition and exchange rates. Full-year Biotage AB sales grew 2.3% to SEK 394.1 million ($51.5 million = SEK 7.66 = $1) from SEK 385.3 million ($58.5 million = SEK 6.59= $1), for a 9% currency-neutral decrease. EU area and US sales each made up 40% of revenues. Sales to the Rest of the World accounted for 20%. Adjusted operating profits dropped 71.1% to SEK 7.9 million ($1.0 million) due to currency. Gross margins declined 120 basis points to 57.1% of sales.

Fourth-quarter revenues for Caliper Life Sciences grew 2.6% to $37.7 million (see page 12), but were flat on a currency-neutral basis. Adjusted operating income was $2.5 million compared to a $1.5 million loss last year. Gross margins climbed nearly nine percentage points to 49.5% of sales due to increased license fees and lower manufacturing expenses. Excluding the divested operations, revenue climbed 12.9%, 10% on a currency-neutral basis, to $35.8 million. Demand for IVIS grew 20% to account for 67% of sales. LabChip GX shipments soared over 75% to 109 units. Research sales grew 18.6% to represent 51% of pro-forma sales. Microfluidics sales climbed 41% (10% excluding a license fee), but automation revenue fell 4%. Imaging revenue improved 11.7% to account for 45% of sales. Research and Caliper Discovery Alliances and Services (CADS) revenue declined 25.0%. Sales to the biotech/pharmaceutical and academic/government markets accounted for 65% and 35% of sales, respectively. Americas and the Rest of the World represented 55% and 45% of revenues, respectively.

Full-year Caliper revenues declined 2.7% to $130.4 million, including a decline of 1% from currency. Adjusted operating loss narrowed to $4.9 million from $13.2 million a year ago. Gross margins improved 290 basis points to 44.4% of sales. Revenues from continuing operations gained 7.4%, 9% organically, to $119.7 million, with a Becton Dickinson (BD) license contributing roughly 2%. Research sales rose 13.6% to account for 43% of pro-forma revenues. Within Research, microfluidics demand rose 26%, excluding the BD license fee. Automation sales declined 5%. Imaging revenue rose 13.6% to account for 43% of sales. CDAS revenue fell 35.3% to make up 5% of sales. The company projected 2010 organic revenue to grow 3%–6% to $123–$127 million, including a 10% average growth estimate for the Imaging business, flat Research revenue growth and a decline of 8% for CDAS.

QIAGEN NV’s fourth-quarter revenues grew 21.9%, 14% organically, to $289.1 million. Acquisitions and foreign-currency contributed 2% and 7%, respectively. Adjusted operating profits climbed 27.6% to $81.0 million. Gross adjusted profit margins declined 97 basis points to 71.5% of sales. For the year, revenues jumped 13.1%, 16.3% at constant-exchange rates, to $1,009.8 million, including 4% growth from acquisitions. Organic sales increased 13%, including 5% growth from new products. Consumables revenue climbed 10% to account for 86% of sales due to a 15% increase in sales of molecular diagnostics products. Instrument sales jumped 37% to make up 14% of sales. Molecular diagnostic, applied testing, pharmaceutical and academic markets accounted for 47%, 6%, 21% and 26% of sales, respectively. For the year, sales to the Americas, Europe and Asia climbed 10%, 11% and 39% to make up 49%, 36% and 12% of revenues, respectively. Adjusted operating profits climbed 17.7% to $285.4 million. Adjusted profit margins slipped 70 basis points to 72.2% of sales. The company expects 2010 revenues to growth 11%–16% to $1,120–$1,170 million, with organic growth of 13%. For the first quarter, the company projected average revenue growth of 17% to $255–$265 million.

Tecan’s 2010 revenues slipped 1.0% to CHF 391.9 million ($359.6 million = CHF 1.09 = $1) from CHF 396.0 million ($366.7 million = CHF 1.08 = $1) (see page 12). In local currency, sales grew 0.9%. Orders declined 5.4% to CHF 385.5 million ($353.7 million) due to Sample Management. Adjusted operating profit slipped 0.8% to CHF 59.6 million ($54.7 million). Gross profit margins declined 100 basis points to 50.8% of sales. Despite strong demand in Japan and China, Liquid Handling & Robotics revenue fell 6.0%, 3.7% on currency-neutral basis, to account for 64% of sales due to lower end-customer sales in Europe and Australia. Components & Detection revenue rose 6.0%, 7.5% in local currency, to make up 27% of sales. Sample Management revenue jumped 19.5%, 18.7% on a currency-neutral basis. European sales fell 5.1% to represent 45% of sales. North American sales grew 4.9% to account for 39%, but Asian sales were flat to make up 12%. Sales to other countries fell 12.1%. Tecan forecasts single-digit 2010 sales growth in local currency, with lower Sample Management revenue.

IBO Life Science Sales Index companies: Affymetrix; Becton, Dickinson & Company (BD Biosciences); Bio-Rad Laboratories (Life Science); Biotage AB; Bruker; Caliper Life Sciences; Illumina; Life Technologies; Luminex; QIAGEN NV; Sequenom; Tecan; and Waters.

Chart: Quarterly Sales Performance January 2006–December 2009

Q1 Q2 Q3 Q4

2006 1837 1875 1873 2120

2007 2018 2124 2106 2376

2008 2229 2442 2335 2481

2009 2238 2346 2352 2747

Chart: Quarterly Operating Profit Margins January 2006–December 2009

Q1 Q2 Q3 Q4

2006 14.5% 13.5% 12.8% 16.2%

2007 14.9% 14.2% 14.9% 18.1%

2008 16.1% 15.6% 16.2% 18.4%

2009 16.3% 17.2% 17.9% 20.0%