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Water Street bets on German specialty Dx outfit

Plans investment, expansion through M&A deals
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Germany's Orgentec Diagnostika has drawn in Water Street Healthcare Partners as a major investor, which has plans in place to grow the 25-year-old specialty diagnostics company through future M&A deals down the line.

Neither side is disclosing the size of the investment. But the deal gives Chicago-based Water Street a majority stake in Orgentec, and Water Street senior operating partner Scott Garrett will become Orgentec's chairman. (He's the former chairman and CEO of Beckman Coulter.) Water Street has also agreed to back future M&A deals designed to build Orgentec into a "global leader" in its particular diagnostics sphere, according to the deal announcement.

Orgentec co-founder Wigbert Berg said in a statement that the investment will help Orgentec expand into new areas of testing and grow further in emerging markets. He'll still keep an ownership stake with Orgentec and serve on its board of directors. With the deal in place, diagnostics veteran Werner Hofacher becomes CEO, moving to Orgentec after leading Beckman Coulter's European operations.

"With Water Street's support, we have a unique opportunity to expand Orgentec's global position and to grow its portfolio of tests in order to help providers detect rare conditions and positively impact millions of lives," Hofacher said in a statement.

Orgentec, based in Mainz, launched in 1988. It develops, produces and markets diagnostic assays for autoimmune and infectious diseases, and has more than 300 tests and counting focused in areas including rheumatology, thrombosis and gastroenterology disorders. The products are known as enzyme-linked immunosorbent assays (ELISA). Orgentec also sells automated instrument and related test kits designed to handle multiple tests and produce faster results than standard ELISA tests allow. Until now, the company's sphere of growth has focused on Europe, and more recently Asia, Latin America and the Middle East.

Water Street, which is based in Chicago, typically commits $50 million to $500 million investments to companies that focus on medical and diagnostic products, specialty distribution, outsourced healthcare services, and specialty pharmaceutical products and services. It also has a large pool of cash with which to invest: close to $2 billion, according to its web site.

ELISA diagnostic technology has drawn steady investor and market interest of late. In April, CyVek attracted $10 million in funding from Minneapolis-based BioTechne to nurture its microfluidic cartridge technology designed to help researchers analyze multiple biomarkers from very small samples: the technology can be used to enable faster diagnostic tests and ELISA-like tests, among other applications. In January, Germany's Wilex inked a deal with GeneDiagnostics to market Wilex's serum HER-2/neu ELISA breast cancer biomarker test in China.

- read the release

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