- Thermo Fisher Scientific on Tuesday announced it will acquire privately-held molecular diagnostic maker Mesa Biotech for $450 million in cash, with the potential for an additional $100 million upon the completion of certain milestones. The deal is expected to be completed in the first quarter of this year.
- The acquisition adds Mesa's PCR-based Accula rapid point-of-care test platform for SARS-CoV-2, Influenza A and B, RSV and Strep A to Thermo's portfolio of tests. Mesa, with 500 employees and 2020 revenues of about $45 million, will help Thermo Fisher meet the continuing demand for COVID-19 testing as well as scale and develop POC tests for other infectious diseases, COO Mark Stevenson said in a statement.
- The Mesa buy is Thermo Fisher's second major acquisition in less than a week. The company announced on Friday that it bought Novasep's viral vector manufacturing business for approximately $880 million to meet growing global demand for cell and gene vaccines and therapies. Thermo Fisher shares were up more than 1% in late morning trading following Tuesday's announcement.
Rapid point-of-care tests, which provide results within minutes of being administered, have been in high demand during the coronavirus pandemic. One advantage is that it can be used to diagnose COVID-19 in various settings including physician offices, pharmacies, school health clinics, nursing homes, and drive-through locations. However, sites that perform such tests are required to have a Clinical Laboratory Improvement Amendments (CLIA) certificate.
Mesa Biotech's Accula SARS-CoV-2 test, which provides results in 30 minutes, was among the first COVID-19 rapid tests to get FDA emergency use authorization in March during the early days of the pandemic. The technology was developed at Los Alamos National Lab supported by NIH grants from the National Institute of Allergy and Infectious Diseases and the Western Regional Centers for Excellence in Biodefense and Emerging Infectious Disease programs.
Since then, Mesa Biotech's Acula handheld testing platform has received FDA's clearance for the diagnosis of other infectious diseases. The company last month secured 510(k) clearance and a CLIA waiver for its Accula Strep A molecular test, making it the third POC diagnostic test on the Mesa Biotech Accula platform to receive the agency's clearance and a CLIA waiver, following tests for Influenza A/B and RSV.
"The addition of Mesa Biotech's easy-to-use, rapid PCR-based test is highly complementary to our existing offering and will further help us meet the continuing demand for COVID-related testing while we work to rapidly scale and develop point-of care tests for other infectious diseases in the future," Thermo Fisher's Stevenson said.
Mesa Biotech in March was awarded a $561,000 contract from the Biomedical Advanced Research and Development Authority to develop its rapid COVID-19 molecular diagnostic test. That was followed in July with a $15.4 million contract from the National Institutes of Health’s Rapid Acceleration of Diagnostics (RADx) program for the scale up and deployment of the company's Accula SARS-CoV-2 test.
However, FDA earlier this month alerted clinical laboratory staff and healthcare providers about the impact of the U.K. coronavirus variant and other emerging strains of the virus on the results of certain PCR tests, including diagnostics made by Mesa and Thermo Fisher. Still, the agency said "the impact does not appear to be significant" and that the tests may in fact help to spot areas in which the new, fast-spreading variant is prevalent.
Thermo Fisher in October reported $2 billion in sales related to COVID-19 in the third quarter driven by strong demand for testing products and instruments, while its base business returned to growth. The coronavirus-fueled revenues, which were almost double Thermo Fisher's original target, drove organic sales growth of 34% and a 91% jump in adjusted earnings per share.
At the time, CEO Marc Casper said demand for PCR "continues to be very strong" and that he expects it to continue in 2021, despite the rollout of COVID-19 vaccines. Back in October, Thermo Fisher forecasted COVID-19 to contribute $1.75 billion to revenues in the fourth quarter and its base business to be flat to up slightly sequentially with projected sales growth of 29% organically in the fourth quarter.
Thermo Fisher on Feb. 1 will announce its fourth quarter and full year 2020 financial results.