Roche Buys North County Biotech GenMark For $1.8 Billion
Speaker 1: 00:00 Well, many industries have suffered as a result of COVID-19. The biotech industry has grown Carlsbad's GenMark diagnostics. For example, was just bought by Swiss pharmaceutical giant Roche for $1.8 billion. This is thanks to its development of rapid testing kits, which has put San Diego in the spotlight for bringing innovation to the market. During a pandemic, the San Diego union Tribune technology reporter Mike Freeman has been covering San Diego companies like Jen Mark that have been creating new technologies to quickly diagnose COVID-19. He's joining us now, Mike. Welcome. Speaker 2: 00:37 Thank you. Thanks for having me. Speaker 1: 00:39 So GenMark a company that made less than 200 million in revenue just sold for $1.8 billion. Why was this company so attractive to Roche? Speaker 2: 00:49 Well, it, um, fills a hole in, in kind of Roche's portfolio of, uh, tests for, um, uh, diagnostic tests. And, you know, the roaches is Roche diagnostics. They have a whole diagnostic division. They are, they have, uh, many, many tests, um, molecular and non molecular, um, tests that are in, you know, sold to hospitals and, uh, hospital labs and so on. But this, um, test that, um, Jen Mark has his platform, the GenMark has, um, is something is kind of an emerging, um, technology and it fills a hole that Roche did not have in their profile. Speaker 1: 01:27 And what is it about these testing kits that advances the technology already out there? Speaker 2: 01:33 So, um, what GenMark does is, uh, syndromic testing. So they have a platform that, um, allows you to test for multiple, um, illnesses, um, in one kind of run. So what typically happens in, in these, in these hospital labs is, you know, you'll come in and you'll have, uh, symptoms saying, you know, I got a runny nose, a fever, a headache, a stomach ache, you know, what do I got? And they'll run it. The doctor will say, well, it sounds like the flu and I'll run a test for the flu or, or maybe it sounds like COVID, and they'll run a test for COVID. And if that, if that test comes back negative, then I kind of start all over with the next potential virus. It might be what Jen Mark and some other companies have done is, um, develop a test that will search for the markers of many viruses so that people can, you know, get diagnosed faster and then treated faster. Speaker 1: 02:39 Another local biotech, Mesa biotech was also recently purchased by a larger pharmaceutical company. Tell us about that. Speaker 2: 02:46 Yeah. So Mesa biotech is, uh, is interesting. They do a PCR test, which is a molecular test. That's kind of the gold standard of these, um, COVID tests for point of care, which is, is more like in the clinics, right in medical offices and areas that are not like big hospital labs or hospital labs at all. Um, so what, what, uh, Thermo Fisher scientific, which also is a very large diagnostics has like very large diagnostic division. They, um, they purchased Mesa and I, you know, I think a little bit what you're seeing here is some of these big, bigger pharma, bigger life sciences companies, making bets that diagnostic testing is going to be, you know, very important in kind of a post COVID era. Speaker 1: 03:37 Hmm. And with more people getting vaccinated, how much COVID testing will actually be needed moving forward. Speaker 2: 03:43 That's a really good question. And, um, you know, I don't think anybody knows, but there are a couple of schools of thought, uh, on it. Um, you know, one is that, you know, you're, there probably will be less testing needed going forward. However, you know, in the next couple of years, you will probably still see a large demand for tests. You can imagine that going forward, if you have any procedure in a hospital that requires a hospital stay, whether that's like having a hip replaced or going in having a baby, you're going to get a COVID test before you go in. And, and that's something that is new. Um, and there's sort of going to be that sort of testing there potentially could be a lot of emphasis. And the Biden administration has talked about this on these, in the field tests, like, you know, things that you could even do at home where, you know, you could, I'm not feeling well and, and I can run a COVID test, or I can ask my doctor to give me a prescription and I can go to CVS and buy a little COVID test. Speaker 2: 04:42 And, you know, as long as they're cheap, then enough people do that. Then there's going to be demand for that sort of testing, you know, to, to allow kids to go to school, allow people to go to work and that sort of thing. So there's that, there's the school of thought that thinks that, um, you know, testing will be around for a long time. And then there's also the, you know, the potential for the next virus. The COVID may not be the end of this era. And so we may see another one, um, that will need to be tested for going forward. So in the variants from COVID two will need to be tracked. Um, especially if one comes up that is, you know, can sidestep or is not a, you know, the vaccines aren't as effective against there's. Uh, a lot of speculation that testing even with vaccines is going to be around and become a rise in importance for a long time. Speaker 1: 05:31 Why do you think local biotech companies have been so successful in innovating testing products to help us through this pandemic? Speaker 2: 05:38 You know, that's a good question and I'm not sure I have a great answer to it. I mean, I, all I would say is that, um, you know, the expertise tends to cluster in these tech fields and, you know, so you have some strong expertise in this area, um, locally and, and, you know, again, the, they tend to cluster, um, and that happens with a lot of industries. Speaker 3: 06:00 I've been speaking with Mike Freeman who covers technology for the San Diego union Tribune. Mike, thank you so much for joining us today. Again, thanks for having me.