Dive Brief:

• Hologic has struck a deal to buy near-patient, acute care diagnostic company Mobidiag for approximately $795 million, continuing its M&A spree this year.

• The deal will give Hologic control of two automated PCR instruments used in the diagnosis of gastrointestinal and respiratory infections and management of antimicrobial resistance.

• Analysts at SVB Leerink and Evercore ISI welcomed the deal, which the latter said "fills a major hole in the company's armament" in a point-of-care molecular testing market that is "becoming crowded very fast, spurred by the pandemic."

Dive Insight:

Hologic has used the pandemic-driven growth of its diagnostics business to make a string of deals. The company set the tone in the first week of January, when it disclosed the $64 million acquisition of Somatex and the $230 million takeover of Biotheranostics, before going on to reach a $159 million agreement with Diagenode in March.

Analysts at SVB framed the latest deal as part of the same strategy that drove the earlier acquisitions, contending the "faster-growing, complementary/leverageable technologies" will help Hologic exit the pandemic "with a strengthened growth profile and overall financial/competitive position across its business segments." Evercore ISI analysts called the deal "compelling."

The takeover of the Finland-based medtech will move Hologic into an acute care testing space adjacent to its existing diagnostic capabilities and expand its international presence. Analysts at SVB estimate the acute care market is growing at around 20% a year.

Mobidiag has two automated platforms, Amplidiag and Novodiag. Hologic focused its statement on, and committed to investing in, Novodiag, which uses real-time PCR and microarray capabilities to enable testing for multiple pathogens in a single sample. The multiplexing is potentially useful in management of patients who present with symptoms that could be attributable to many pathogens. By giving a result in one hour, the test could enable timely treatment of the cause of the problem.

Analysts at Evercore highlighted Mobidiag's ability to test for more than 100 organisms and as few as one organism on the same system as a differentiator. The analysts also see ease of use and cost of goods sold as areas in which Mobidiag may have advantages.  

The two platforms underpinned sales of $42 million at Mobidiag last year. Hologic expects the deal to be dilutive to its earnings in fiscal 2022 and 2023, in part due to its plan to invest in the development of assays for Novodiag. Evercore analysts predict Hologic could grow sales to $300 million a year over the next five years.

Hologic expects the Mobidiag takeover to close in the fourth quarter of its fiscal year.