Agilent Technologies agreed to acquire Dako from EQT, a Sweden-based private equity group, for $2.2 billion, making the deal the largest in Agilent’s history.

Dako, a cancer diagnostic company based in Denmark, is well known in the industry for its companion diagnostics and was the company that made the first test for the HER2 gene, which is used to predict whether a breast cancer patient will respond to treatment with Genentech’s drug Herceptin.

Dako’s diagnostic tests and supplies complement Agilent’s measurement tools and technology, which are used by researchers and engineers in chemical analysis, life sciences, electronics, and communications. It also expands its medical business which has seen growth slow over the past year.

“Agilent’s strategy in acquiring Dako is about strengthening the company’s presence in life science and about revenue growth,” says Bill Sullivan, Agilent’s president and CEO.
For Dako, the deal provides the Danish company increased access to global markets, and particularly emerging markets, where Agilent has a strong presence.

Dako has been a leader in developing companion diagnostics for cancer drugs, developing tests that can help clinicians predict whether a patient will respond to a particular drug. Since the beginning of the year, it has entered into two separate collaborations with Amgen to develop companion diagnostics for investigational cancer drugs in Amgen’s pipeline, and has struck a similar deal with Genentech, now a division of Roche.

Just recently, Dako and Van Andel Research Institute announced they would collaborate on the licensing, manufacture, and distribution of cancer diagnostics utilizing the MET4 antibody, which was developed by researchers at Van Andel and the Fred Hutchinson Cancer Research Center. The MET4 antibody has been shown to work well with tumors expressing the human MET oncogene. Dako will also have the right to develop MET4 companion diagnostics in collaboration with pharmaceutical companies to identify cancer patients who may benefit from MET-targeted therapies.

Agilent plans to fund its acquisition entirely with cash held outside the United States, where the company is headquartered. The company's expect to close the deal within the next two months.