Bio-Rad Laboratories to Capitalize on Growth in Cell Biology and Food Testing

Bio-Rad Laboratories held its first ever Investors Day this month. However, the company often hosts Investor Breakfasts at the AACC Annual Scientific Meeting & Clinical Lab Expo. Bio-Rad’s Life Science Group is one of the largest manufacturers of life science laboratory equipment and products. The division’s 2016 sales totaled $730.7 million, growing 5.1%. Life Science accounts for 35% of Bio-Rad’s total revenues compared to 65% for the Clinical Diagnostics Group. Bio-Rad also used the occasion to lay out long-term  revenue targets for the company as a whole (see table).

Source: Company presentation

The Life Science presentation at the event emphasized the division’s focus on its elements of success and the opportunities that lie ahead. In particular, the company highlighted its continued investment in existing technologies and market strongholds, as well as new investments to grow both the applications and end-markets for these tools.

As Annette Tumolo, executive vice president and president of the Life Science Group, told the audience, “We’ve spent a lot of time over the past several years really focusing on developing and building our business in consumables and reagents and assays.” Consumables account for almost half of the division’s revenue at 48%, with Instruments/Apparatus representing the remainder.

Source: Company presentation

Improving how these products get to customers is a current focus of the division. “In a market that depends really heavily on having consumables available when you need them, and doing good lab practices to get good results, we’re really committed to making sure that we’re improving our online access and our supply center access, so our customers have the products when they need them, where they need them,” remarked Ms. Tumolo.

The Life Science Group serves three end-markets (see graph below). For biopharma, a range of product categories is evident. “In biopharma, we have products that expand the entire workflow from discovery all the way through to manufacturing and quality control,” noted Ms. Tumolo.

Source: Company presentation


As with the bipharma market, a similar range of products is available for the research market, such as many standard life science laboratory tools. These products include solutions for amplification and gene expression, bio-chromatography, protein quantification and cell biology, as well as antibodies. “I think the Life Science business is really driven off the back of proven technologies; again, these core technologies with tools that scientists use day in and day out. Bio-Rad is present in many of these proven technologies,” said Ms. Tumolo. Additionally, she noted that these key tools now include software and bioinformatics.

Ms. Tumolo emphasized how such established technologies continue to provide growth opportunities. As an example, she described the company’s V3 Western workflow, combining its reagents, gels, blotting apparatus, imager and antibodies for western blotting. According to her, the workflow solution resulted in new benefits for researchers, saying that the “workflow reduced time-to-answer dramatically and allowed them to visualize if their proteins separated well, verify that their proteins were transferred onto the blot and validate their quantitative results in the end.”

Such a solution-based approach was also echoed in Ms. Tumolo’s recounting later in the day of Bio-Rad’s success in the thermal cycler market in the 1980s. “We did this by offering a complete solution that didn’t just package the platform, the reagents, and the consumables and software together,” she explained. “But what we packaged was customer care and support in the field that really escorted the customers down the pathway to success. In the process we set a new bar for field support in this area that all of our competitors had to follow.” She noted that the market for PCR and real-time PCR continues to grow, led by consumables sales for Bio-Rad’s sizable installed base and new applications.

“What we really decided to do was develop simplified, accessible and intuitive platforms that could enable this emerging group of new scientists that were blurring the lines across the disciplines of cell biology and molecular biology.”

Among the company’s other fast growing application markets is cell biology. The company entered the market earlier this decade with an automated cell counter, and has since expanded its product line to include flow cytometers and associated reagents and assays, cell sorters, cell imagers and antibodies. “With the increased interest in cell biology, we saw a real opportunity to develop some tools with simplified workflows that were accessible and benchtop, addressing customers who are new to cell biology,” commented Ms. Tumolo. “What we really decided to do was develop simplified, accessible and intuitive platforms that could enable this emerging group of new scientists that were blurring the lines across the disciplines of cell biology and molecular biology.” This philosophy is maintained across Bio-Rad. “As a company, we really pride ourselves in making the complex simple, or making products very accessible to our customers,” she said.

For the applied research markets, Bio-Rad’s offerings are based on the company’s PCR and real-time PCR technologies. However, these technologies serves a range of applications. “The offerings for the applied markets range from food safety testing to water quality and science education,” stated Ms. Tumolo. The market is a growing opportunity due to demand for rapid time to results and geographic expansion. “Our food testing business is one of our biggest incremental growth drivers,” she said. “We have a comprehensive suite of products based on our qPCR technology, hardware, software and validated tests for rapid-turnaround molecular testing of pathogens in food.”  The market also provides opportunities for novel PCR techniques such as droplet PCR.

Bio-Rad’s droplet PCR technology, currently commercialized as its droplet digital PCR products (ddPCR), was the focus of its own presentation. Bio-Rad launched its first ddPCR products, which include instruments and consumables, in 2011. Bio-Rad seeks to capitalize on the technology’s demand and potential in both the life science and clinical diagnostics market. Earlier this year, the company added to its droplet technology with the purchase of digital PCR competitor RainDance Technologies (see IBO 1/31/17).

Consumables revenue is expected to exceed 50% of digital PCR sales next year, according to Ms. Tumolo.

Currently, research accounts for 50% of Bio-Rad’s digital PCR  sales, with biopharma making up 30% and liquid biopsy/diagnostics representing 20%. Instruments account for 68% of this revenue. These systems utilize Bio-Rad’s proprietary consumables. Consumables revenue is expected to exceed 50% of digital PCR sales next year, according to Ms. Tumolo. By region, the Americas, Asia and EMEA represent 45%, 29% and 26%, respectively, of digital PCR sales.

Focus applications for Bio-Rad for its ddPCR and droplet technology are genomics in the research market and liquid biopsy in the clinical market, according to Ms. Tumolo. A fast growing application for droplet technology in the research market is NGS. Ms. Tumolo noted that Bio-Rad is targeting four NGS sub-markets: RNA-Seq, whole-genome sequencing, targeted sequencing and whole-exome sequencing. As she explained, “We’re going to develop products in areas where droplets can make a difference. The first place that we are moving is a pretty large and rapidly growing market, NGS sample prep.” Earlier this year, the company and Illumina released the Single-Cell Sequencing solution, which incorporates Bio-Rad’s ddPCR technology.

Although research labs are the biggest customers for Bio-Rad’s ddPCR products, Ms. Tumolo described the enormous potential for liquid biopsies using digital PCR. “The move of this technology from the translational research labs into the clinic was astonishingly fast,“ she said, noting that much of this growth is driven by China and Asia. To grow sales, Bio-Rad plans to gain regulatory approval for the technology. In 2016, the company announced the first CE-IVD marketing of its QX200 ddPCR system, and it is in the process of submitting its first test, for blood cancer, to the US FDA for approval.

With a focus on cancer, the company is initially concentrating on the droplet technology’s use with liquid biopsies for residual disease testing and therapy guidance, according to Ms. Tumolo. LDT tests will also be enabled on the platform. In additional, the company is considering third-party licenses for kit developers, with deals expected to be completed as early as next year.

For both the Life Science Group and  its digital droplet technology in particular, Ms. Tumolo highlighted ongoing R&D efforts and a focus on growing markets to continue Bio-Rad Life Science’s success in the marketplace and its position in core technologies.

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