QIAGEN is playing a pivotal role in the genomic revolution by empowering customers to transform raw biological samples into valuable insights for use in a broad range of everyday applications across the life sciences and clinical healthcare. We believe QIAGEN can achieve sustained growth thanks to our global leadership in Sample & Assay Technologies, which form the basis of all of our products, and underpinned by an expanding customer base, an excellent product portfolio, and a pipeline of innovative new systems and products.
QIAGEN believes the relevant global market for molecular diagnostics and life science research products totals approx- imately $ 70 billion. The industry’s long-term growth drivers include ongoing breakthroughs in molecular biology, new technologies to analyze molecular information, improve- ments in the quality of healthcare and reductions in cost using diagnostics, and revenue streams made possible through consumable products and bioinformatics software tools. We have grown substantially in recent years with a flexible strategy for developing innovative new products, partnering, and acquiring companies or technologies with high growth potential.
QIAGEN will continue to leverage our global leadership in Sample & Assay Technologies to meet the needs of customers across the continuum of research and commercial testing. Our strategies for the future are guided by the QIAGEN vision of making improvements in life possible through the use of our innovative products in a growing number of applications.
QIAGEN Perspectives for 2014
QIAGEN delivered on its goals during 2013 by executing on strategic initiatives to accelerate growth and innovation. We are continuing our focus on these initiatives and have identi- fied five key growth drivers for 2014: (1) driving global adop-
tion of the QIAsymphony platform and expanding the menu of test content; (2) extending QIAGEN’s leadership in Personal- ized Healthcare with innovative companion diagnostics; (3) establishing the QuantiFERON-TB test as the modern gold standard for latent tuberculosis control; (4) expanding the use of bioinformatics in molecular applications, including our In- genuity and CLC bio franchises; and (5) creating an indus- try-leading portfolio to drive use of next-generation sequencing (NGS) in clinical research and diagnostics.
QIAsymphony, our breakthrough modular platform for com- plete sample-to-insight workflows, is empowering a new era in laboratory automation. This flagship instrument surpassed the goal of more than 1,000QIAsymphony systems installed worldwide by year-end 2013, and we have set a new target of 1,250 by year-end 2014 . In late 2013, we submitted the entire QIAsymphony RGQ MDx platform for U.S. Food and Drug Administration review, including QIAsymphony SP for sample preparation, QIAsymphony AS for assay setup, and Rotor-Gene Q MDx for our real-time PCR detection. Demand is strong for QIAsymphony’s features, including its unique ability to provide automated handling for commercial assays as well as a broad array of laboratory-developed tests.
QIAsymphony is a key growth driver in 2014, supporting all of QIAGEN’s customer classes, particularly Molecular Diag- nostics.
In 2013 we continued to expand the menu of content running on Rotor-Gene Q MDx, a key module of the QIAsymphony family, increasing the platform’s value to customers in 2014
and beyond.
QIAGEN’s leadership in Personalized Healthcare, using companion diagnostics to guide treatment based on patients’ individual genetic characteristics, continues to drive growth. In the United States, our evidence-based reimbursement strat- egy gained traction in 2013 and uptake improved for our current FDA-approved companion diagnostics, the thera screen
C OR POR A TE G O V ER N A NC E ES U LT S
EGFR test for use in patients with metastatic non-small cell lung cancer (NSCLC) and the therascreen KRASRGQ PCR
Kit for use in patients with metastatic colorectal cancer. In Europe we recently introduced the therascreen IDH1 / 2 test, enabling physicians to better diagnose and assess the pro- gress of patients with gliomas. In 2013 we announced sever- al new co-development agreements in Personalized Health- care, including our third oncology project with Eli Lilly and Company, a proposed new companion diagnostic with Clovis Oncology, and a first-in-class, blood-based companion di- agnostic under development with Exosome Diagnostics. In 2014, QIAGEN and Exosome will begin launching a series of high-performance sample preparation kits. These kits will extract and purify high-quality nucleic acids (RNA and DNA) from exosomes, tiny enclosures that circulate in the blood and other fluids, offering potential for a non-invasive way to diag- nose and monitor diseases without the need for tissue biopsies. Our QuantiFERON-TB Gold test is expanding globally as the modern gold standard in screening for latent tuberculosis in- fection, replacing the unreliable, 120-year-old tuberculin skin test. Sales of QuantiFERON-TB grew more than 20 % CER in
2013. To help control TB, a contagious public health threat,
QIAGEN is focusing on key subpopulations such as health- care workers, patients with reduced immunity, and individuals who have lived in regions where TB is endemic. Having es-
tablished market leadership in the United States and Europe, we are preparing to launch QuantiFERON-TB in 2014 in China, the world’s second-largest market. In current markets, we are expanding into additional subpopulations such as type 2 dia- betes patients.
In 2013, QIAGEN acquired two leaders in the emerging mar- ket for commercial bioinformatics – Ingenuity Systems and CLC
bio – and began expanding our global leadership in software for genomic analysis and interpretation. Adjusted 2013 com- bined sales of the two businesses were more than $ 30 million on a pro forma basis, and we expect rapid double-digit growth in 2014. With these bioinformatics solutions, QIAGEN
is enabling a broad range of customers to transform data from genomic sequencing into valuable insights. We plan several important product launches in 2014, including a new web- based Ingenuity solution to deliver faster, easier-to-use and high-confidence clinical interpretation and reporting from
NGS-based tests and new bioinformatics for cancer research based on CLC’s Genomics Workbench.
QIAGEN’s strategy to drive the adoption of next-generation sequencing (NGS) in clinical research and diagnostics focus- es on significant bottlenecks for NGS users – such as diffi- cult-to-process clinical samples and challenges in the analysis of large amounts of complex data. Building on our leadership in sample technologies and our solutions for bioinformatics,
[11] Our Ambition: Accelerating Innovation and Growth
Mid-term targets
Above-market net sales growth
Accelerating net
sales momentum and operating cash flowIncreasing margins Deploying capital andgenerating returns with shareholdersFurther aligning
Improving profitability and
we are commercializing a range of “universal” sample and assay consumables compatible with any NGS platform. Sample technologies include pre-analytic kits such as our REPLI-g Single Cell Kit for highly accurate sequencing from single cells and minute amounts of DNA. On the assay side, in
2014 we will expand our NGS portfolio of GeneRead™
DNAseq gene panels for use in cancer and other diseases. At the same time, we are developing the novel GeneReader™ benchtop sequencer for NGS users.
For 2014, QIAGEN expects to deliver higher adjusted net sales on a mix of contributions from organic growth as well as the acquisitions of Ingenuity (in April 2013) and CLC bio (in August 2013). Profitability is expected to improve significantly compared to 2013, a year in which significant restructuring charges were taken to better position QIAGEN for future growth, with double-digit gains expected in operating income and earnings per share (EPS). Improving cash flows and a strong balance sheet are expected to further enable QIAGEN
to grow through investments in new products and geographic expansion as well as through targeted acquisitions.