Dive Brief:
- Laboratory instruments maker Agilent Technologies is shutting down Resolution Bioscience, a liquid biopsy business it acquired for $550 million in 2021.
- Agilent will wind down Resolution’s facility in Seattle over the next few months, spokesperson Sarah Litton said Friday by email. The company did not disclose the number of employees affected by the closing.
- Agilent made the difficult decision to shutter the business because the market for kit-based, next-generation sequencing (NGS) companion diagnostics (CDx) did not develop as the company had expected, CEO Mike McMullen said on an earnings call last week. “Furthermore, we don't see a realistic path to profitability,” he noted.
Dive Insight:
Unlike a traditional biopsy that tests tumor tissue directly, a liquid biopsy is a blood test that can detect cancer cells or DNA circulating in the bloodstream. A few liquid biopsies, including tests from Guardant Health, Foundation Medicine and Roche, have been approved by the Food and Drug Administration.
Such tests can help physicians tailor treatments for cancer patients and, it is hoped, detect cancer earlier, but the market for the diagnostics is still developing. Frustration over Illumina’s $8 billion acquisition of liquid biopsy maker Grail in 2021 led to a proxy fight that resulted in the ouster of Illumina’s chairman and resignation of its CEO. The Federal Trade Commission in April ordered Illumina to divest Grail, to preserve competition in the liquid biopsy market.
Traditional biopsies often rely on immunohistochemistry, or IHC, testing to examine body tissue for cancer.
Agilent’s Litton said the company had expected the Resolution Bioscience acquisition to complement its IHC business by adding NGS-based companion diagnostics capabilities to its offerings. The company also expected a longer-term opportunity in liquid biopsy kits.
“What we have come to recognize is that the market for distributed, kit-based NGS-based diagnostics has not developed,” Litton said.
Agilent took a $291 million pretax charge in the third quarter related to the shutdown of Resolution Bioscience.
The company cut its full-year revenue outlook to a range of $6.8 billion to $6.85 billion, representing a decline of 0.7% to flat results compared with a year ago. The reduced forecast is due in part to the Resolution closure and laboratory customers’ cautious spending on capital equipment, but mostly due to reduced expectations for demand in China, Agilent said.
