Veterinary drug giant Zoetis Inc. has agreed to acquire diagnostic equipment maker Abaxis Inc. for $1.9 billion, the companies announced May 16.
“Together we can bring more veterinarian customers a broader range of products that fit into our comprehensive solutions and innovations, from prediction and early detection of disease in animals to prevention and treatment,” said Juan Ramón Alaix, Zoetis’s CEO.
The deal is expected to close by year’s end.
Abaxis reported 2017 revenue of $227.2 million, much of it from the sale of chemistry analyzers and reagent discs. The Union City, California, company’s VetScan hematology diagnostic products can be found in Banfield Pet Hospital’s 1,000 locations.
“Zoetis has the global presence and direct veterinary customer relationships to deliver greater value to more customers around the world and accelerate the growth of our international operations,” said Abaxis’ chairman and CEO, Clint Severson.
A small part of Abaxis’ business, or 16 percent, comes from the sale of Piccolo analyzers and tests in human medicine. What Zoetis intends to do with Piccolo was not reported.
Zoetis, which achieved record 2017 revenues of $5.3 billion — about 23 times Abaxis’ performance — is looking to capitalize on the thriving veterinary diagnostics market.
“Zoetis expects the diagnostics category to continue to grow faster than the animal health industry, with growth in the mid to high single digits, driven by international adoption of point-of-care diagnostic instruments due to rising medicalization rates, increasing standard of veterinary care and the convenience of in-clinic testing,” the company reported.