Original from: Fierce Biotech
Not long after acquiring Resolution Bioscience in a deal worth more than half a billion dollars, Agilent Technologies has resolved to shutter the business, which was developing liquid biopsy tests that were powered by next-generation sequencing technology and meant to be used as companion diagnostics for cancer patients.
Mike McMullen, Agilent¡¯s president and CEO, announced the ¡°difficult decision¡± during a call with investors about the company¡¯s third-quarter results last week.
¡°The market for kitted NGS-based companion diagnostics has not developed as we expected. Furthermore, we don¡¯t see a realistic path to profitability,¡± he said, according to a transcript of the call, adding, ¡°However, our investments in future growth continue.¡±
Agilent moved to purchase Resolution in the spring of 2021, and the acquisition was completed within about six weeks of the initial announcement. It saw Agilent shell out $550 million in upfront cash, while also offering up to $145 million more if Resolution¡¯s blood tests hit certain commercial goals.
At the time, Agilent said it was expecting to see Resolution¡¯s revenues tick solidly upward over time¡ªfrom pre-acquisition annual revenues of about $35 million to more than $50 million in its first year under the Agilent umbrella.
Though Agilent doesn¡¯t break out its revenue reports by individual business, McMullen noted on this month¡¯s investor call that Resolution had seen continued ¡°market weakness¡± as of late.
Drops within the Resolution department and Agilent¡¯s genomics business offset what would have otherwise been a solid win for the company¡¯s diagnostics and genomics segment for the quarter. The pathology business grew by high single digits, while Agilent¡¯s nucleic acid therapeutics saw a boost in the ¡°high teens,¡± the CEO reported¡ªbut altogether, thanks to the headwinds in Resolution and genomics, the overall segment experienced a year-over-year increase of just 3% to reach $349 million for the quarter.
The shuttering of the Resolution business will continue through the final quarter of Agilent¡¯s fiscal year 2023, which ends Oct. 31, and into the early months of its fiscal 2024, Robert McMahon, the company¡¯s chief financial officer, said on the call.
McMahon added that Agilent had taken a pre-tax charge of $291 million in the third quarter because of the wind-down.
During its short-lived period as a member of the Agilent family, Resolution landed a first-of-its-kind FDA approval for the Resolution ctDx FIRST test. It was given the greenlight late last year to become the first liquid biopsy NGS test that could be used as a companion diagnostic to single out people with advanced non-small cell lung cancer who had certain genetic mutations that made them strong candidates for Mirati Therapeutics¡¯ Krazati.
Not long after, Agilent signed a collaboration deal with Quest Diagnostics to make the blood test more widely accessible to non-small cell lung cancer patients across the U.S.
