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Going With the Flow

Executive Summary

In the in vitro diagnostics world, flow cytometry is a highly specialized, labor intensive niche, aimed at sophisticated analysis of intact whole cells. Dako Cytomation was formed in July to try to make inroads into this field, which some see as an area poised for growth. The merger of Dako and Cytomation, however, has infuriated Dako's former partner, Partec, a small German company focused on industrial applications of flow. Partec, however, is coming up with a new strategy for expanding its limited presence in human healthcare.

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An Intelligent Evolution for Dako and Cytomation

The Dako-Cytomation merger gives both companies things they've wanted for some time. Denmark-based Dako, a leading global supplier of IHC reagents and systems, gets a solid instrument platform and a stronger presence in the US. US-based Cytomation, an aggressive maker of high-speed flow cytometry instruments, gets a world-class marketing partner and a high-quality reagent house. The businesses complement each other, with almost no redundancies, say both companies' CEOs.

Dako Ponders the Expanding Universe

Dako AS, has always been known for its technical acumen and has a strong following in niche laboratory segments, such as immunohistochemistry and in-situ hybridization. But as competition increases, regulations get tighter for research reagents, and customers demand integrated systems, Dako has had to change. It is becoming more focused on clinical products, necessitating major shifts in regulatory and sales and marketing functions, with an aim on achieving global coordination. HercepTest, its first clinical product, is a success, and it hopes to capitalize on a growing interest in pharmacodiagnostics. But it faces tough competition in the systems business from Ventana Medical Systems, a one-time small competitor that now dominates the IHC systems market. Dako is also gambling on a move into flow cytometry.

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