Waters sees chromatography growth despite flat Q1
Whilst Waters reported flat overall sales of $431m (€312m) across all its divisions, the company reported a 5% growth in its service and chromatography consumables business for the quarter year-over-year.
This was led by its downstream purification Acquity systems range, CEO Douglas Berthiaume said on a conference call yesterday, with its benchtop mass spectrometry system the Acquity QDa particularly helping to turn around recent subdued demand for its chromatography equipment from the biopharma world.
The QDa system works with Waters’ Ultra Performance Liquid Chromatography (UPLC), High Performance Liquid Chromatography (HPLC) and purification systems, and can save biomanufacturers and developers time analysing tracing components of samples.
“Demand for this compact mass detection technology exceeded the unit shipment volume in the fourth quarter of 2013,” he said, adding in the past three months the firm “saw drug research customers purchase the QDa as a detection module for existing UPLC or HPLC systems as well as within new system orders.”
The CEO also expects sales for its consumables to increase in the next few quarters to reflect the previously forecasted mid-single-digit organic growth for the year, with new product launches and the release of large pharma capital.
“The demand that we saw in the first quarter is particularly encouraging, as we believe it represents a rather small proportion of the likely full year sales, given that many capital budgets were not released in the first quarter,” Berthiaume said.
Mega-merger opportunity?
The management were questioned during the call as to what affect the rumoured Pfizer and AstraZeneca mega-merger - as well as other recent movements amongst big Biopharma - may have on business, if it comes to fruition.
While admitting nothing is really underway for now, Berthiaume said if such a takeover happens it would not affect this year’s business.
“To the extent that [mega-mergers] do happen, I'd say we've seen both kinds of effects in the last, 10 years… I'd say in many of those cases, you always see somewhat of a delay, but a pretty rapid return to a normal run rate of business.”
However, he continued, some large deals have led to R&D consolidations and significant cutbacks, which have been made up by new demand from specialty pharma and biotech.
“That's where I'd say you really have to look at the specifics of any transaction,” he said. “And who knows if a US company really gets $100 million or more in tax benefits from doing this [by benefiting from a UK corporate tax rate in Pfizer’s case], maybe they'll have more money to spend on R&D.”
