It was one of the largest med-tech deals of the year. However, Qiagen NV shareholders were apparently not satisfied by Thermo Fisher Scientific Inc.’s offer, with the voluntary public takeover bid not achieving the minimum 66.67% acceptance threshold. A total of 47% of the outstanding Qiagen shares were tendered into the offer of €43 (US$50.95) at the expiration of the acceptance period Aug. 10.

The deal, initially valued at $11.5 billion, was revealed in March and came after reports in 2019 that named Thermo Fisher as a potential suitor for Qiagen, of Venlo, Netherlands. Qiagen had said last December that it had wrapped up a review of potential strategic alternatives and decided its standalone business plan represented the best opportunity for value creation.

It now appears that the standalone stance was popular. “The magnitude and duration of the global coronavirus pandemic have proven the increasingly critical importance of molecular testing to society. Qiagen’s business prospects have improved significantly, as shown in our performance for the first half of 2020 and the strong outlook for the rest of this year and for 2021,” said CEO Thierry Bernard.

The news comes after Thermo Fisher tried to sweeten the deal. During its July 22 second-quarter earnings call, Thermo Fisher noted that it had renegotiated parts of the acquisition agreement, boosting its all-cash offer to the €43 per share figure. “Qiagen is an excellent fit for our company, and we're excited about the new opportunities we'll have following the close,” CEO Marc Casper said at the time.

That wasn’t enough for Qiagen shareholders. As a result of this action, the company has pledged to continue to pursue its proposal to fully acquire Neumodx Molecular Inc., which is doing well with its molecular diagnostic testing platforms, a solution for coronavirus testing and a growing range of assays worldwide.

Further, as the company continues to help fight the COVID-19 pandemic, it also plans build on its leadership in sample technologies; implement a strategy to accelerate the adoption of Quantiferon-TB in the fight against tuberculosis; speed commercialization of Neumodx and Qiastat-Dx systems; and enter the digital PCR market with Qiacuity launch.

Word of the deal’s dissolution comes the same week that Htg Molecular Diagnostics Inc. Said it had signed a commercialization and distribution agreement with Qiagen Manchester Ltd., a wholly owned subsidiary of Qiagen NV. The 10-year agreement aims to help both parties to combine their technological and commercial strengths and offer pharmaceutical companies global development, distribution and commercialization capabilities for companion diagnostic assays based on Htg Edgeseq.

Shareholders balk

Puneet Souda of SVB Leerink noted that at least two big shareholders previously had said they would not tender their shares, reasoning that a standalone business was more valuable, particularly in the wake of the pandemic. That made up roughly 15% of total shares owned.

Indeed, the company’s second largest investor, Davidson Kempner, heralded the rejection, labeling Thermo Fisher’s bid a “wholly inadequate offer” in an Aug. 13 statement. “The low acceptance level of 47.02% is a clear signal that there is widespread confidence in the long-term prospects of Qiagen NV,” the group added.

Davidson Kempner had reiterated its feelings on the deal earlier this month.

Still, Qiagen appears to be in a good spot. “Qiagen's molecular testing portfolio including the RNA extraction kits and multiplex respiratory panel Qiastat-Dx have been in high demand since the onset of the pandemic. This has led to an acceleration of Qiagen's top-line growth in [the first half of 2020], growing 9% organically in [the first quarter] and 18%-19% organically in [the second quarter],” Souda wrote.

While it did not hold a quarterly earnings call due to the presumed close of the deal, Qiagen did see net sales grow 16% vs. the same period last year.

With the termination of the agreement, Qiagen will pay Thermo Fisher, of Waltham, Mass., $95 million in cash in accordance with the terms of the acquisition agreement. Souda sees great opportunities for Thermo Fisher, as it has room to look at other deals. “TMO has a long history of acquiring assets and improving the growth and margin profile over time,” he wrote, pointing to the Life Technologies and Fei buys. "We expect M&A to continue to be a part of the growth strategy for TMO over the longer-term.”

The deal had led the pack in terms of size. However, August witnessed the proposed tie-up of Varian Medical Systems Inc. and Siemens Healthineers AG in an all-cash transaction valued at $16.4 billion. That was quickly followed by a definitive merger agreement between Teladoc Health Inc. and Livongo Health Inc. valued at $18.5 billion.