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LIFE-QDEL Alliance Gets 510(k) Sanction

Zacks Equity Research

Life Technologies Corporation’s (LIFE) diagnostic testing menu is set to gain from the recent U.S. Food and Drug Administration's (:FDA) 510(k) clearance for two infectious disease tests of the company’s partner Quidel Corporation (QDEL). According to both the companies, FDA recently allowed Quidel’s Molecular Influenza A+B assay and Molecular RSV + hMPV assay to run on QuantStudio Dx Real-Time PCR Instrument, Life Technologies’ flagship instrument for the diagnostics market.

Quidel’s Influenza A+B assay determines whether patients have the influenza A and/or B virus and detect the H7N9 subtype. According to the company, this subtype shows 30% mortality rate in China. Human exposure to infected poultry is the prime cause of transmission of H7N9 infections in human. However, recently the British Medical Journalreleased a probable case of human-to-human transmission of this infection.

On the other hand, Quidel's RSV + hMPV assay diagnoses two lung infections, respiratory syncytial virus (:RSV) and human metapneumovirus (hMPV). hMPV accounts for 7.1% of respiratory tract infections. Thus, Life Technologies believes these clearances will help the company to expand its infectious disease detection menu, available on the QuantStudio Dx instrument.

Of late, Life Technologies has sharpened its focus on product platforms with a string of new product launches over the recent past. The disclosure of its impending acquisition by Thermo Fisher Scientific Inc. (TMO) will further boost LIFE's product suite. With the overwhelming approval of its stockholders in favor of the deal, the impending acquisition of Life Technologies is now subject to customary closing conditions.

We are also encouraged by Life Technologies’ strategy to strengthen its presence in high-growth geographic markets such as Latin America, the Middle-East, China, and India. Life Technologies views immense potential in applied markets where technologies can help to carry out biological research in fast-growing industries such as forensics, and food and water testing.

Over the next few years, Life Technologies’ focus on developing industry-leading franchises in high-growth technology areas, applied markets and emerging geographies will be the key driver for long-term growth.

Currently, the LIFE stock carries a Zacks Rank #3 (Hold). On the other hand, Exactech Inc. (EXAC), carrying a Zacks Rank #2 (Buy) is worth considering.

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