Third-quarter 2011 IBO Life Science Index sales grew 6.7%, 4.6% excluding currency, to $3,149.7 million. Operating profit improved 2.1% to $641.8 million, and operating margin slipped 90 basis points to 21.4% of sales.

Fiscal fourth-quarter revenue for Becton Dickinson’s BD Biosciences division grew 9.6%, 4.7% excluding currency, to $354.2 million to account for 17% of company sales. All figures below exclude currency. International sales climbed 7.3% to $229.5 million, led by strong demand from emerging markets. Despite weak core consumables sales, US revenue improved 0.5% to $124.6 million. Segment operating profit climbed 19.3% to $100.8 million due to currency and a weak year-over-year comparison. Cell Analysis (CA) revenue grew 5.7% to $273.2 million due to strong demand for reagents. US and International CA sales grew 3.6% and 6.8% to make up 33% and 67% of segment sales, respectively. Discovery Labware revenue (DL) grew 1.6% to $81.0 million, including 9.8% growth for International revenue and a 6.8% decline in US sales to make up 57% and 43% of segment sales, respectively.

Full-year revenue for BD Biosciences improved 6.7%, 3.2% on a currency-neutral basis, to $1,341.1 million to make up 17% of total company sales. Revenue growth was reduced by 3.6% as a result of US and Japanese stimulus funding in 2010. All figures below exclude currency. US and International sales grew 1.9% and 4.0% to $484.9 million and $856.3 million, respectively. Full-year operating profit rose 6.3% to $376.4 million. CA revenue expanded 4.3% to $1,024.4 million, including US and International sales growth of 4.7% and 4.0% to account for 33% and 67% of CA sales, respectively. DL sales were flat to make up 24% of segment sales due to timing of large orders from distributors and slower research funding. US sales declined 4.4% to represent 45% of DL sales, while International sales grew 4.1% to account for 55%. The company slightly lowered its BD Biosciences’ fiscal 2012 revenue growth rate to 4%–6% on a currency-neutral basis due to research funding concerns. Acquisitions will account for 1%–2% of this growth. The company estimated its exposure to NIH funding is roughly 5%–6% of revenues. Over the next three years, BD Biosciences’ revenues are projected to grow by an average annual rate of 3.8% on a currency-neutral basis, driven primarily by sales of new research and personal flow cytometers and a new personal desktop sorter. The company has also initiated restructuring activities to eliminate slow growth and low-margin products from the DL portfolio.

Biotage’s third-quarter revenues slipped 2.7% but grew 5% excluding currency to SEK 106.6 million ($16.5 million = SEK 6.48 = $1). Organic sales were driven by new peptide synthesis and sample preparation systems. Consumables and service revenues also contributed to growth, accounting for more than 50% of sales. Following lower demand in the second quarter, US sales were particularly strong and European sales recovered to represent 42% and 35% of sales, respectively. Sales to Asian markets, with the exception of China, declined. Sales to Japan and the Rest of the World made up 14% and 9% of sales, respectively. Operating profit soared 125.4% to SEK 10.9 million ($1.7 million), as operating expenses declined as a result of exchange rates. Gross margin declined 150 basis points to 57.8% of sales due to a shift in product mix and pricing.

Prior to the completed acquisition by PerkinElmer on November 7, Caliper Life Sciences reported third-quarter sales of 24.2%, 16% organically, to $36.9 million. Acquisitions and currency contributed 6% and 2% to revenue growth, respectively. Imaging revenue grew 11.7%, 11% excluding currency, to make up 44% sales, primarily due to sustained demand for CRi tissue-imaging products. Despite a 10% increase in system placements, in vivo imaging revenues declined 1% following a shift toward lower-priced Lumina instruments and increased distribution channel mix. Research revenue climbed 41.8%, 38% excluding currency, to account for 50% of sales due to strong demand for next-generation sequencing sample preparation and process-control products. The LabChip and Automation businesses grew 48.4% and 31.9% to account for 31% and 19% of company sales, respectively. LabChip sales also benefited from increased OEM business with Agilent Technologies and a 73% jump in microfluidic license and royalty revenue. Caliper Discovery Alliances & Services revenue grew 3.2% to make up 6% of sales. Adjusted operating profit soared 187.1% to $1.0 million. Gross profit margin improved 10 basis points to 53.3% of sales, including a 200 basis point increase in product gross margin.

Third-quarter sales for Merck Millipore grew 5.2%, 7.3% organically, to €588.3 million ($828.6 million = €0.71 = $1). Acquisitions added 1.5% to revenue growth, while currency reduced sales by 3.5%. Distribution problems in 2010 elevated organic sales growth by 2%–3%. The firm reported strong demand from biopharmaceutical customers and for Lab Solutions products, but growth was partially offset by slower academic and industrial sales. The Lab Solutions, Process Solutions and Bioscience businesses accounted for 42%, 40% and 18% of Millipore sales, respectively. Lab Solutions sales were driven by strong demand for Lab Water and BioMonitoring products. Process Solutions sales benefited from strong growth in emerging markets, double-digit growth in sales to biotech customers and increased sales of single-use manufacturing products. Despite strong demand for flow cytometers and double-digit growth in both China and India, Bioscience revenue was negatively impacted by slower academic sales. Adjusted operating profit fell 14.4% to €107.0 million ($150.7 million) due to currency and increased R&D and sales expenses. Adjusted gross profit margin fell nearly two percentage points to 57.9% of sales because of higher production costs. Full-year Millipore sales are projected to grow 47% to roughly €2,470 million ($3,455 million).

Sequenom’s third-quarter revenues climbed 16.2% to $13.6 million, but adjusted operating loss widened by 16.4% to $18.3 million (see page 12). Gross profit margin fell five percentage points to 59.8% of sales due to product mix. Molecular Diagnostics (MD) revenue jumped 223.0% to account for 16% of sales primarily due to increased testing services for cystic fibrosis. MD operating loss widened by 10.5% to $10.6 million due to increased R&D and sales expenses related to the launch of the Materni T21 test. Sales for the Genetic Analysis segment grew 3.3% to represent 84% of revenues. Consumables sales grew 10.5% to $6.3 million as a result of increased demand from translational research and agricultural biology markets. Revenue from contract research services was constant at $1.0 million. MassARRAY systems revenue declined 4.7% to $4.1 million due to a shift toward lower-priced systems. Genetic Analysis operating profit slumped 32.1% to $2.6 million.

 Column Graph: Quarterly Organic Sales Change

 January 2008–September 2011

 Quarterly Sales Change    

 Year    Q1    Q2    Q3    Q4

 2008  6.8%  9.2%  7.1%  2.7%

 2009  3.6%  0.9%  1.9%  5.8%

 2010  9.4%  8.6%  8.8%  6.3%

 2011  5.8%  6.7%  4.6% 

 


 Column Graph: Quarterly Operating Profit Margins

 January 2008–September 2011

 Year     Q1     Q2     Q3     Q4

 2008  18.2%  18.1%  18.8%  21.1%

 2009  19.1%  20.2%  21.4%  22.9%

 2010  22.1%  22.6%  22.3%  23.0%

 2011  22.1%  21.1%  21.1% 

 


 Life Science Index, Total              

                                 2008      2009       2010      2011     08/09    09/10     10/11

 Total Annual Revenues ($M)   $11,077   $11,268    $12,189     -----      1.7%     8.2%     -----

 Annual Oper. Profits ($M)     $2,105    $2,321     $2,673     -----     10.2%    15.1%     -----

 Annual Oper. Profits (%)       19.1%     21.0%      22.5%     -----     -----    -----     -----

 3rd Quarter Revenues ($M)     $2,733    $2,748     $2,952    $3,150      0.5%     7.4%      6.7%

 3rd Quarter Oper. Profits ($M)  $510      $565       $629      $642     10.9%    11.2%      2.1%

 3rd Quarter Oper. Profits (%)  18.8%     21.4%      22.3%     21.4%     -----    -----     -----