DiaSorin: Distribution and Pricing | In Practise

DiaSorin: Distribution and Pricing

Former General Manager at bioMérieux

Learning outcomes

  • Distributing DiaSorin's products
  • LIAISON vs VIDAS
  • Pricing of diagnostic products
  • Luminex acquisition
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Executive Bio

Former General Manager

Former General Manager at bioMérieux

The executive is the Former General Manager at bioMérieux where he was responsible for the Nordics before being promoted to run the Lab Automation division in France. He has experience competing with Dia Sorin’s LIAISON product as a major competitor to bioMérieux’s VIDAS line. He also previously ran Addtech’s Life Sciences division where he was responsible for distributing Dia Sorin products throughout the Nordics as well as other competing diagnostic products. Read more

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Disclaimer: This interview is for informational purposes only and should not be relied upon as a basis for investment decisions. In Practise is an independent publisher and all opinions expressed by guests are solely their own opinions and do not reflect the opinion of In Practise.

My questions are primarily from DiaSorin’s angle, and you have done some work on DiaSorin at Addtech, then spent a lot of time at bioMérieux. Could you explain your background and then I will ask my questions if you don't mind?

I have a medical background and I have been working my whole professional career within biotech, medtech and pharma. I started my commercial career at Organon which was part of AkzoNobel. Organon was a pioneer in diagnostics and a very interesting company. They invented the ELISA plate and made the first conjugates for the HIV test and HTLV. They also made the first extraction system for molecular biology, with a technology called NASPA, which was also a pioneer in the field of PCR.

It was more precise than the technology from Roche because it was silica based and isothermic, so offered much better stability. Unfortunately, the company was divested from AkzoNobel who are a very large group with over 90,000 people. Their main business was chemical so they never understood the added value of having pharma and sold half of the company to Merck and the other half to bioMérieux.

At that time, I was the General Manager for Organon in the Nordic countries and I had the opportunity to continue with bioMérieux, where I became General Manager in the Nordics for some years, then moved to France as the head of the lab automation division. They were also interested in the journey because I had teams in the US, Europe, Japan and other markets. That was extremely useful for me to get that experience. After that journey of several years, I was head hunted to the Sweden group Addtech, where I was the CEO of Addtech Life Science who have 18 subsidiaries.

Addtech Life Science created a separate NASDAQ listed company called AddLife in 2016. By the time I left the company, there were 35 companies in the group. I started my own company in Gothenburg, Sweden within genetics and have also been working as a consultant and on the board of several companies. Today I am mainly working on strategies and acquisitions, because of my extensive experience over the years, working with leadership questions.

Is that how you overlapped while at Addtech, marketing DiaSorin?

Yes exactly, not only when I was at bioMérieux but also because in the Nordics, LIAISON was one of the main competitors for VIDAS which belongs to bioMérieux.

What do you think about the Luminex acquisition from DiaSorin, which has a big focus on molecular, where they did not have much presence prior to this?

Moving into that direction for DiaSorin was very important. I know that DiaSorin also acquired a smaller company in Ireland, called Biotrin. Making that move was very good, but the critical mass of that company was not big enough to build a competitive portfolio. We were wondering when DiaSorin would go into molecular and so the Luminex acquisition makes sense in many ways, including being clearer in the molecular biology area. Immunology is good but the market is changing rapidly, especially with point of care molecular biology solutions.

LIAISON is still a cost-effective system, so you do not necessarily need to switch into molecular for the same kind of tests because what you are doing may be good enough for a certain diagnostic test you are answering. Several years ago, everybody wanted to get into molecular platforms, but they realized two important things: work flow and cost efficiency. If it is good enough, you do not need higher specificity on certain tests, so you should differentiate your immunology and molecular platforms.

Roche acquired GenMark with the same strategy. I have heard physicians in North America are more open to using multiplexing to look for 15 to 20 pathogens, as opposed to in Europe where physicians are not that enthusiastic, is that true?

No, I will give you my view about that. If you look to Cepheid and GeneXpert, by definition that is not really multiplex, but they have done a kind of multiplex with the GeneXpert. That is perhaps the closest competitor today. They have developed the Luminex technology for point of care and multiplexing and when bioMérieux acquired BioFire, this was the essence of having a point of care test where you have a broad panel.

But as you said, will you pay a premium to know 18 or 20 parameters or would you like to run more specific tests? You are correct because the US has more screening, which is why BioFire has been so successful there, whereas in Europe they want to be more specific. I do wonder who will win the race, but BioFire have done extremely well over the past year.

They have a broad panel but I do not know how it compares to Luminex. If you have an RSV panel and a gastro panel, for certain things it makes sense. If you are looking for influenza or an RSV virus that makes sense because if it's positive you would like to see more specifics and will be prepared to pay a premium price. If you would like to make a portfolio analysis for the different solutions, I will happy to help you with that, specifically saying which panels are good enough and will feed into both the American and European mindsets. Asia is not there yet when it comes to multiplex, but I have seen bioMérieux open an office in Singapore and they have won many deals in Southeast Asia. I am unsure of their progress in China, but GenMark, Luminex and BioFire are taking the lead with many other followers.

One of the bigger factors in the US with diagnostic testing is reimbursement from governmental programs. Is that similar in Sweden or other markets you have worked in, and do you see any headwind for DiaSorin due to molecular pricing being higher than immuno?

The US has a more insurance-driven healthcare system. If you look at sepsis or susceptibility testing, you are prepared to pay a premium to get the right medication immediately because it costs a lot of money if you miss that. That is why Idaho started, the company who founded BioFire, because in the US you can easily get $150 but in Europe, they have been more reluctant to pay this and prefer to pay for immunology or molecular tests instead.

The reimbursement system is not driven in the same way and there are many differences in Europe, with the UK, Germany and Benelux being more similar to the States, whereas Sweden is more budget-driven. There is still much work to be done before you can fully position with a good reimbursement system.

I did look at Addtech and AddLife when I evaluated companies in Sweden, but decided not to invest in either. Addtech does additional procedures before distribution but there were also certain products where they simply acted as a distributor and I assume DiaSorin fell into that bucket. DiaSorin keeps announcing new partnerships, for example with QIAGEN on latent TB and Lyme Disease, and with MeMed in Israel to discover bacterial disease. I am not sure who else has relationships with Roche, Beckman, QIAGEN and MeMed, but the company does not disclose who benefits. Did you ever see any of that from your standpoint?

Yes, are you talking about Addtech or DiaSorin?

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