Instrument Makers Expand Deal, File Suit

FOSTER CITY, Calif., and TORONTO, Sept. 8 -- Applied Biosystems Group, an Applera Corp. scientific instruments business based in Foster City, Calif., and MDS Inc., a health and life sciences company in Toronto, announced on Sept. 1 they will expand the life science mass spectrometry joint venture they established in 1986 in Toronto.

MDS has agreed to pay $40 million for a 50 percent interest in intellectual property assets related to current Applied Biosystems MALDI TOF (matrix-assisted laser desorption/ionization time-of-flight) mass spectrometry systems and products under development, together with a 100 percent interest in certain MALDI TOF product-related manufacturing and research and development assets. MDS and Applied Biosystems will each contribute the MALDI TOF and related intellectual property to Applied Biosystems/MDS Sciex Instruments, a 50/50 joint venture of Applied Biosystems and MDS Sciex, the analytical instrumentation division of MDS Inc.

On Sept. 3, Applera Corp., MDS Inc. and Applied Biosystems/MDS Sciex Instruments filed a complaint in US District Court for the District of Delaware alleging that Thermo Electron Corp.'s mass spectrometer systems infringe US patent 4,963,736, "Mass Spectrometer and Method and Improved Ion Transmission."

Thermo Electron, a Waltham, Mass., maker of analytical instruments, said the lawsuit focuses on its triple quadrupole mass spectrometers, US sales of which represent approximately one percent of its annual revenues. Thermo Electron said it denies infringement of the patent. According to Thermo Electron, the patent was the subject of prior litigation with respect to triple quadrupole mass spectrometers against a subsidiary of Waters Corp., a Milford, Mass., maker of liquid chromatography, mass spectrometry, thermal analysis and rheology products.

The joint venture expansion transaction is subject to customary closing conditions, including approval by regulatory authorities in the US and Canada, and is expected to close in or before the fourth quarter of 2004.

For more information, visit: www.appliedbiosystems.com