Laboratory automation offered by large diagnostic companies has been slow to gain customer acceptance. One bright spot has been Dade Behring Inc.'s Dimension product line, which has found in recent years a loyal following. The Dimension RxL offers the first chemistry analyzer that has the option of also running a number of common heterogeneous immunoassay tests. It has been a huge success, giving Dade a 92% market share of the 32% of laboratories that have systems integrating clinical chemistry and immunoassays, helping labs save labor, time and money. Dimension is the product line most responsible for Dade's comeback from bankruptcy two years ago.

The diagnostic industry's buoyant health was evident at this year's American Association for Clinical Chemistry meeting in Los Angeles. Floor space was sold out and attendance hit a record. In contrast to a malaise in the industry through much of the 1990s, diagnostics now have reimbursement, demographic, and labor shortage trends in their favor. At $24.9 billion in revenues, experts say the industry is poised to deliver another year of double-digit growth, following an 11% gain in 2003.

A year ago, Dade Behring, the nation's sixth largest diagnostics company, was facing a huge debt and very angry debt holders. Now, the company seems close to a deal that would allow it to cut the debt in half (to about $750 million) and give debtholders full ownership of Dade Behring. The company would file a voluntary pre-packaged bankruptcy in federal court, which would also enable it to start trading securities on the public equities market. Nothing is finalized, but sources say the company is confident it will prevail. Meanwhile, its financial performance is picking up, with strong growth in all core product lines.