Gen-Probe Inc. (GPRO), a leading diagnostic devices company, recently announced the approval of the U.S. Food and Drug Administration (“FDA”) for its PANTHER system, an immunoassay instrument for molecular diagnosis. The system has been given the initial approval to be used with its market-leading chlamydia and gonorrhea test APTIMA COMBO 2.
The PANTHER system can process a number of different molecular tests as well as generate results on all phases of nucleic acid testing (“NAT”) on a single platform, with minimal human interference. The instrument can process roughly 275 tests in 8 hours and about 500 tests in 12 hours. The device, with its high level of automation, is expected to replace a full day’s laboratory work with 4 hours of labor-free result processing.
The California-based company had filed a 510(k) approval to the FDA some time in May 2011. It received the European CE mark for the instrument in December 2010 and the Canadian approval in August 2011. With the U.S. clearance, a vital milestone has been achieved in the company’s endeavor to make this breakthrough product available to the global blood screening market.
Gen-Probe has developed several assays designed to run on the PANTHER system. The PANTHER along with the TIGRIS system are among the most important devices in the company’s product portfolio.
Gen-Probe’s revenues rose 7% year over year to $153.4 million in the most recent quarter. Product sales increased 9% to $150.1 million as healthy sales across Blood Screening and Clinical Diagnostics franchises was partially offset by lower revenues from the Research Products and Services and Collaborative Research businesses. Revenues from Collaborative Research plunged 61% to $1.4 million, hurt by lower funding from Novartis (NVS) for the development of the PANTHER system for blood screening.
Gen-Probe is a dominant player in the rapidly expanding NAT market, the fastest growing segment in the clinical diagnostic market. It is a market leader in domestic gonorrhea and chlamydia testing with its PACE and APTIMA assay product lines. Gen-Probe competes with more established firms in the molecular diagnostic industry such as Roche (RHHBY), Becton, Dickinson (BDX) and Abbott Labs (ABT).
Currently, we have a long-term Neutral recommendation on Gen-Probe, which is in tandem with a short-term Zacks #3 Rank (Hold).
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