Dive Brief:

Though FDA is ramping up its scrutiny of genetic tests claiming to predict individual patient responses to drugs,payers have become more open to the idea of reimbursing for the tests. In response, major labs and pharmaceutical companies are scrambling to establish relationships with DNA sequencing players that could be lucrative down the line.

Blueprint, founded in 2012,provides genetic diagnostics of rare diseases based on an NGS method developed at Stanford, which was an early investor in the startup. The eight-year-old company has scaled relatively quickly by decreasing the price of genetic diagnostics while adding clinical insights through gene variant interpretation of the results, identifying associations between quirks in the gene and potential diseases and treatment responses.

Quest already sells more than 700 genetic tests but is looking to Blueprint to spur growth across diseases and geographies.

"Blueprint Genetics has developed a proven model for delivering highly specialized genetic insights that we believe we can scale to serve new patient populations with unmet clinical needs," Quest CEO Steve Rusckowski said in a Wednesday statement.

It's the latest acquisition from Quest as the 53-year-old lab behemoth elbows for market share with Burlington, North Carolina rival LabCorp. Quest has embarked on sustained M&A over the past three years, most recently nabbing the clinical lab services of Columbia, Missouri-based Boyce and Bynum Pathology Laboratories in November 2018.

Though the pace of acquisitions last year was slower than Wall Street expected, both Quest and LabCorp reiterated their eat-or-be-eaten strategy at the J.P. Morgan Healthcare Conference in San Francisco earlier this year, highlighting acquisitions and market share gains as key drivers of diagnostic growth.

Blueprint, which operates in more than 70 countries, "considered joining forces with several organizations" before agreeing to be acquired by Quest, according to Tommi Lehtonen, Bueprint's CEO, who will stay on as VP and general manager. The privately held DNA player has raised more than $26 million over four funding rounds, most recently a Series B round in November, and brings in an estimated $4 million in annual revenue, according to Owler.

As the biopharma business grows, Blueprint opened its first North American lab in October: a hub facility in Seattle. The company says it plans to scale further by leveraging Quest's national infrastructure (it serves half the health systems and providers in the U.S.), though Quest noted Blueprint will continue to "operate largely independently" from its headquarters in Helsinki.

Unlike the roiling direct-to-consumer space, Blueprint's genetic tests are targeted for hospitals and research groups. But there's significant overlap between players, especially as heavy hitters Ancestry and 23andMe look to carve out market share in health testing. Ancestry announced in October it was partnering with clinical labs, including Quest and rival Illumina, to sell physician-ordered tests for genes relates to heart disease and other conditions.

Quest plans to announce fourth quarter earnings Jan. 30.

The rest is here:
Quest buys Helsinki-based Blueprint Genetics to expand reach - MedTech Dive