The Life Science market consolidation trend continued today as Nestle SA acquires privately held Prometheus Laboratories, Inc. of San Diego,CA for about $567M according to a Bloomberg story although the price was not disclosed. Other stories put the price closer to $1B.Prometheus was forecasted to have revenues of $250M next year (they might be much higher) for gastrointestinal and cancer tests. Prometheus was founded in 1995 by and the current ownership are a group of banks and VC’s. An IPO S-1 was filed in August of 2010, so obviously the BOD of Prometheus felt the acquisition was a better long term move despite an improving financing window.
This deal punctuates the trend for nutritional companies to move into healthcare as many chronic diseases can be prevented and treated by lifestyle and nutritional (Nx) changes.
The Rx/Dx business model has also gained strength in recent years as targeted therapy with companion diagnostics has proven to be more effective in treating diseases such as cancer and infection.The CEO of Prometheus Joseph F. Limber said with the Nestle relationship,” We also intend to leverage Nestlé Health Science’s nutritional product offerings and geographic presence to expand our successful Rx/Dx business model into a Dx/Nx/Rx model.” Prometheus offers a broad menu of standard and esoteric diagnostic tests for gastrointestinal, cancer and immunological diseases such as Crohn’s, IBD serology, H.pylori and lactose intolerance.
Prometheus also sells specialty pharmaceuticals for such as Proleukin for oncology and Lotronex for IBS.