Eyeing diagnostics growth, Roche up for $3B deal

Roche CEO Severin Schwan isn't short on expectations for the diagnostics business. He's been touting the concept of targeted drug therapies for some time, and lately he can point to the company's new melanoma treatment Zelboraf, approved alongside a diagnostic test to identify appropriate patients.

Now, Schwan says he's up for acquisitions that would fit into that drug-plus-diagnostic approach. In an interview with Bloomberg, the Roche ($RHHBY) chief said a deal about the same size as Roche's 2008 purchase of Ventana Medical Systems—$3.4 billion—would be worth jumping on.

Roche won't stop shopping for smaller buys—100 million to 300 million Swiss francs, or $106 million to $320 million—but "the right opportunity" of a Ventana-type size could work, too, he said. "If something comes up, of course we will seize it," he said.

As Bloomberg points out, three of Roche's four buyouts in 2011 were designed to augment the diagnostics business. The biggest of them was its buyout of in-vitro diagnostics company PVT Probenverteiltechnik and its U.S. distribution arm PVT Lab Systems; that deal amounted to 65 million euros ($85 million) up front, plus as much as 20 million euros in milestone payments. "We see the synergies between pharma and diagnostics coming to life," Schwan said.

- read the Bloomberg piece

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