Danaher and COVID: $2bn orders for 2022 without potential Omicron windfall

COVID-19 continues to drive bioprocess orders for Danaher Corporation, but the extended vaccine rollout and the unknown impact of the Omicron variant could see a further surge in 2022.

In April, Danaher spoke about its efforts in the manufacture of COVID-19 vaccines and therapeutics, adding an estimated $2 billion in 2021 revenue to its bioprocess businesses Cytiva and Pall.

As 2022 appears over the horizon, CEO Rainer Blair told delegates at the Evercore ISI Annual HealthCONx Conference orders for COVID-related equipment and consumables sit at another $2 billion for next year already.

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The $2 billion “are really orders that are in hand and that are for 2022 delivery,” he said, adding this breaks down to being around 85% vaccine and 15% therapeutic-based revenue.

However, Blair noted that these figures do not take into account any potential evolution of the pandemic, particularly how the recently discovered Omicron variant will play out.

But while “the ultimate implications” of Omicron are still unknown, “one thing is for sure, it does appear that a broader percentage of the population is going to be going for booster shots,” he said.

“It’s almost easier to talk about what’s included and not included in that order book in the sense that we anticipated that in the developed markets that the broader adult population would require a booster shot,” he continued.

“But if you think about what’s excluded, that would be a broader stroke or population requiring boosters outside of the US as well as children twelve and under having the approval to get shots as well. So that’s excluded. And that represents a potential upside.”

Cytiva growth

Blair also spoke about the specific growth of Cytiva, acquired for $21 billion in April 2020.

“When we originally acquired the GE Biopharma – now Cytiva – business, we viewed that really as being a 6% to 7% grower,” he said.

“And what we’ve seen here through the pandemic, through the funding increases, but also through our share gains, is that that for the long-term is really a high single-digit growing business. And the way to think about that is today already, this business is far larger than we anticipated at $7.5 billion of bioprocessing business [and] that larger base, along with this higher re-rated growth rate, will continue to compound here for the long-term.”