Good afternoon. This is the Chorus Call conference operator. Welcome, and thank you for joining the DiaSorin Full Year 2018 Results Conference Call. As a reminder, all participants are in listen only mode. After the presentation, there will be an opportunity to ask questions. Should anyone need assistance during the conference call, please signal an operator by pressing Star and Zero on their telephone. At this time, I would like to turn the conference over to Mr. Carlo Rosa, CEO of DiaSorin. Please go ahead, sir.
Thank you, operator. Ladies and gentlemen, welcome to the DiaSorin year-end result conference call. As usual, I will provide qualitative comments on the year and some on quarter four, then Mr. Pedron is going to get into discussing numbers in details. In order to discuss how the business is performing, I will always make my comment at constant exchange rate, and specifically about certain geography. I will just say geographies in a way that is a little bit different from the way that is reported in the slides and presentation everybody has received. Let's start from quarter four. At constant exchange rate, the quarter growth year-on-year is 3.6%, and that's a combination of different performances in different geographies.
Let me remind you that when we met at the end of quarter three, and we were discussing about guidance for year-end, we qualified that there were certain elements of uncertainty in certain geographies that I will discuss right now. Let's start first from Europe direct. Europe direct means all the European countries where DiaSorin is operating direct. It's important to look at the geography, because this geography is where we launch all the products without regulatory barrier, and this certainly includes QuantiFERON, that, if you remember, we have introduced to this market in the beginning of quarter four of last year. Europe direct is doing very nicely as a result of that. Actually, we are growing 10%, a little bit over 10%, spread over all the geographies.
Also, Germany, that, if you remember, has been at the beginning of the year in a situation where we were transitioning teams, and we were actually going after conversion of the ELISA business. Also in Germany, we had more stabilization. As far as Europe is okay is concerned, results are good. The launch of QuantiFERON with the support of QIAGEN is working fine. Now let's go to USA. U.S. market in Q4 grew 3.3%, that again, is a combination of plus and minuses. Now let's talk about vitamin D. As discussed, we continue to see in the U.S. a decline on vitamin D. All of us have seen the comments of some of the large labs, Labcorp, Quest, and Sonic, about certain uncertainties vis-a-vis the vitamin D volume. We are monitoring this.
We see that vitamin D is declining with these accounts, it's very difficult to understand what is going to happen and how this will affect 2019. In fact, so far, we only have visibility over a couple of quarters. I was noticing yesterday that one of the big labs, Quest, is saying that, yes, they see vitamin D increase in denial, and they're trying to structure agreement with insurance companies, so they could directly bill or invoice patients. We need to wait and see how the situation will stabilize. CLIA vitamin D, which is the rest of the catalog, is fine, is growing double-digit. We continue the deployment of systems. Let me remind you that at the end of quarter two, we got approval of the last assay that we were expecting, Calprotectin. Now we have the full panel of products, H.
pylori, and the collaboration through Meridian, which is working fine. Now Calprotectin, we're just waiting for the third product, which is the approval of QuantiFERON. We'll talk about it later. Last but not least, DiaSorin Molecular is a combination of molecular and traditional products, is growing mid-single-digits. As far as U.S. is concerned, where you all know we have the liability of vitamin D, the quarter at the end of the story was not bad. Asia Pacific, 19.7% growth. This pretty much reflects the growth of China. China grew 18.7%, and we have deployed over 100 LIAISON XLs in this geography.
As we said, we are picking up steam again in China after we had transition from certain, or let me say, after we have parallel our current distribution network with other distributors, it allow us strategically to move from the Class III base to the Class II base. We have discussed this several times. We see the results of this. Let's talk about the geographies that are underperforming. This is in Latin America direct. For us, Latin America direct is fundamentally Mexico and Brazil. Overall, these two geographies in Q4 declined 14%. This has to be read properly.
We have Mexico growing, we have Brazil actually declining, as a result of one event, which I think we have discussed before, which is the fact that there was a Zika tender that happened in 2017, and the second installment, the second shipment of that tender happened in Q4 2017. This tender was waived. In 2018, we did not have the shipment, and this is why Brazil in quarter four really underperformed. If you actually take away the tender, this effect of the tender, Brazil is flat, which is under expectation, but it is explained by the fact that, due to recent election and changes that have happened in the country, as reported by other companies, government deals are frozen today. It's quite complicated today, really, to grow in that market until the government funds are reallocated, and tenders are open.
The area where we really underperformed is export, this was discussed and qualified in the last quarter. If you remember in the last quarter discussion, we gave a heads-up regarding two specific situations. One is a tender in Korea that we're working with, a third party, Siemens, is part of the heritage of the acquisition of the Siemens business. That tender was supposed to be awarded in Q4, it was not. It has been actually now moved to Q2 this year. Again, we are in the hands from Siemens and our distributor, we continue to wait and see what happens. It's a sizable tender for blood banking. The second geography where we said there was a risk is Iran. Iran is a different story, because as far as the quarter, it was negative.
It was negative because there were still uncertainties related to how to export to Iran as a result of the embargo of the U.S. The good news is that, I remind you that the problem per se is nothing to do with goods, because we work with medical, but to find financial institutions that are available actually to support the transaction. The good news is that that situation has been resolved now in January, we will resume a shipment of goods in 2019. But it did affect the last quarter because the amount of goods we were able actually to move to the country was far less than Q4 previous year. All in all, I think that, in all the strategic geographies, we are doing well as a result of new product launches.
We launched four products last year for immunoassay and QuantiFERON, which is a key product for us in QIAGEN. As a result of the fact that, in certain geographies like China, the distribution network is working fine. The net result of this mix, good performance in direct and the problem being export, resulted, as you notice, in a very favorable gross margin. In fact, if you compare year-over-year, the gross margin Sorry, if you compare the quarters Q4 2017 and Q4 2018, the gross margin improvement is over 200 basis points. It is a combination of mix, but also is a combination of what we call operational excellence, which I think is what we already discussed a few times. Streamlining operations, closing and concentrating manufacturing and so forth.
That clearly also has resulted in a very favorable EBITDA margin in the quarter, which, as you have seen from a percentage-wise at constant exchange rate, is close to 39%. This is the way I believe results in Q4 should be read and interpreted. Let me just move rapidly to guidance 2019. Let me first talk about the fact that on June 11th this year, we are going to have the meeting with analysts and investors, and the presentation of the next four years plan. It is the intention of the company now to explain what the strategy and implementation is going to be throughout 2022. You're going to get much better color on some of the strategic projects during that presentation.
However, if you look at guidance for 2019, you notice that we decided to provide a certain range, I remind you, between 5% and 8% growth. Fundamentally, we commit to the fact that we'll be able to maintain a very favorable EBITDA margin percentage-wise, that we have today with the business. The wide range is determined by the fact that there are certain events that may affect growth this year. Let me, again, remind you what these events are. The first one, as we discussed a few times, is vitamin D decline in the U.S. Still watching and seeing what the big labs are doing vis-a-vis their volume and the way they are addressing the denial rate. Is an uncertainty. The second one is to do with QuantiFERON. Let me remind you that we filed with the FDA QuantiFERON in Q4.
Our plan and the current guidance foresees that we're going to get approval of QuantiFERON in quarter two, is a strategic product, and also for us, engaged in the U.S. U.S. per se, represents roughly 60% of the total worldwide market for QuantiFERON. For this one, we are in the hands of the FDA, the file is under review, but we need to wait and see what happens. The third element, is what we discussed, is the Korea tender. The tender is in our numbers, but we need to understand, how is that going to play out. As said, it is something that is not in the hands of the company per se, but is it through the partnership with. The fourth element is the fact that, as we have discussed a few times, we are under renewal of certain very large contracts, in the U.S.
Happy to report that the first one, which was actually expiring in 2018, was in fact renewed. It was renewed for a long period of time, five years. It covers the existing products and is also adding up to these products, a good chunk of molecular products. It was a very positive end and negotiation that is actually allowing us to continue to supply to these very large labs, continue to be partners and provide them with the esoteric testing they need, with a differentiating set of products. We have the other two contracts are actually in renewal in 2019, and we don't know what the effect of this renewal will be in terms of pricing and mix. That's another uncertainty that can play in our numbers.
Last but not least, which is not new for the ones that are actually covering our industry, is to do with the fact that the flu season is a very weak flu season compared to last year, or actually last year was a very favorable flu season for the business, and this season we are back to normal incidents of patients visiting emergency room and being tested. We need to see how it goes. The flu season typically starts in December and ends in April. Depending on that, which is a good chunk of business for us, it may impact the growth rate for 2019. What I would like to anticipate is that, from what we have discussed right now, we expect growth to be unevenly distributed among the different quarters.
We expect the Q2, Q3 to show progression of growth because there is where we expect the tender to be approved, the QuantiFERON to be approved, and so forth. At this point, I am going actually to move to Hugo Coldu and to Mr. Pedron, who's going to go through the specific comments on the numbers.
Thank you, Carlo. Good afternoon, everybody. In the next few minutes, I am going to walk you through the financial performance of DiaSorin in 2018, and I will make some remarks on the contribution of the fourth quarter. Before we start, let me please remind you that we began reporting the Siemens ELISA business from Q4 2017, and so the full year perimeter of consolidation is different from the one of 2017. Said that, I would like to start with what I believe are the main highlights of the period. We closed 2018 with a revenue increase over the previous year at constant exchange rate of 7.7%, or about EUR 49 million. Since the first half of 2018 was hit by some material FX headwind, to be precise, almost EUR 17 million, the full year growth, as reported, is 5% or EUR 32 million.
These effects headwind should turn into a tailwind in the first part of 2019, considering the current exchange rate of the euro against the USD vis-a-vis the trend we had in H1 2018. 2018 full year EBITDA at EUR 255 million, recorded an increase at constant exchange rate compared to previous year of 11.2%, with a margin, again, a comparable rate of 38.5%, vis-a-vis a result of 37.3% of 2017. 2018 net result at EUR 158 million or 23.6% of revenues, records an increase compared to 2017 of 13% or EUR 18 million. Lastly, we keep confirming our ability to generate a very healthy free cash flow. EUR 164 million, with an increase compared to 2017 of EUR 32 million or 24%.
This allowed us to close 2018 with a positive net financial position of EUR 75 million, after having paid dividends to our shareholders for about EUR 145 million, and after having completed a share buyback program for EUR 65 million. Let's now go through the main items of the P&L. 2018 full year revenues at EUR 669 million, grew by 5% or about EUR 32 million compared to previous year. Gross profit at EUR 456 million, grew by 5.5% compared to previous year, closing 2018 with a ratio of revenues of 68.1%, and so recording a slight improvement vis-a-vis 2017, in spite of dilutive effect of the Siemens ELISA sales and of some price pressure on vitamin D. This performance, which is a touch better than what we originally expected, is mostly driven by higher manufacturing efficiencies, the operational excellence program Carlo was mentioning a few minutes ago, and better geographical mix.
Q4 2018 gross margin improvement compared to 2017, 68.3% vis-à-vis 66.5%, is mainly the result of the different geographical mix Carlo just mentioned. Is, in particular, driven by lower export sales, down in Q4 2018 by 20% of EUR 5 million. Again, the reasons have just been covered by Carlo. 2018 total operating expenses at EUR 245 million or 36.7% of revenues, have increased by 6% compared to previous year. Please remember that EUR 15 million OpEx has been driven by the depreciation of the intangible assets, know-how and customer list mainly, coming from the Siemens, ELISA and Focus business acquisition. 2018 other operating expenses at EUR 5.9 million, have decreased compared to previous year by about EUR 10 million.
This difference is mostly driven by the one-off costs we booked in Q4 2017, related to the divestiture of the Irish manufacturing site, which is going to be completed by the end of Q2 2019. This variance is even more visible in Q4, since this is the quarter in which we accrued these costs in 2017. 2018 EBIT at EUR 205 million or 30.6% of revenues, has increased compared to 2017 by 10.9% or EUR 20 million. 2018 tax rate at 22.6% is up compared to previous year by almost one percentage point, it is in line with what we expected and disclosed during Q4 2017 call. The variance between 2018 and 2017 is mostly driven by the fact that in 2017, we booked the cumulative positive effect of the patent box agreement signed with Italian tax authorities, which covered also 2015 and 2016.
2018 has profited of the impact of one year only. On the other side, though, let me please remind you that 2018 saw the positive impact of the U.S. tax reform. 2018 net result at EUR 158 million or 23.6% of revenues, is higher than previous year by EUR 18 million or 13%. This increase is the result of what described so far, of lower net financial expenses booked in 2018, mostly driven by a reduction in interest and the FX losses, higher interest income, and by the revaluation of the participation in our Indian subsidiary following the takeover of its full control from the local partner. Lastly, 2018 EBITDA at EUR 255 million is better than previous year by EUR 17 million or 7.3%. The variance at constant exchange rate is positive by 11.2%. 2018 EBITDA ratio on revenues is 38.2% at current exchange rate and 38.5% at constant exchange rate.
Please note that in order to have a fair comparison vis-à-vis 2017, we must remember that during Q4 of last year, as just said, we booked about EUR 6 million at EBITDA level of one-off costs driven by the Irish manufacturing divestiture. Moving now to the quarter, Q4 EBITDA margin at 38.9% confirms the profitability recorded in the last periods. The increase compared to 2017 is mostly the result of the better gross margin, as just discussed, and of the timing of the Irish one-off costs. Let me finally move to the net financial position and the free cash flow. We closed the period with a positive net financial position of EUR 75 million after having paid dividends for EUR 145 million and completed a share buyback program for EUR 65 million.
In 2018, the group generated EUR 164 million of free cash flow vis-à-vis EUR 132 million in 2017, thus confirming recording an increase of EUR 32 million or 24%. Lastly, let me move to 2019 guidance at 2018 constant exchange rate. We expect revenues to grow between 5% and 8% and to maintain an EBITDA margin at the same level of 2018. Before concluding, let me please remind you that DiaSorin financials are fairly sensitive to FX fluctuations and in particular to the U.S. dollar, and that for every $0.01 movement of the dollar against the euro, DiaSorin revenues move by about EUR 2 million to EUR 2.5 million on a yearly basis. Now let me please turn the line to the operator to open the Q&A session. Thank you.
Excuse me. This is the Chorus Call conference operator. We will now begin the question and answer session. Anyone who wishes to ask a question may press star and one on their touch-tone telephone. To remove yourself from the question queue, please press star and two. Please pick up the receiver when asking questions. Anyone who has a question may press star and one at this time. The first question is from Peter Welford with Jefferies. Please go ahead, sir.
Hi. Yes, thanks for taking my questions. Firstly, just wondering if you can give us any more visibility on the U.S. contracting, both for 2018, both the contract you've renewed and also the two for 2019, just particularly with regards for vitamin D. I appreciate you not being able to necessarily say much about this, but is there any push from the customers to give further on vitamin D pricing? Perhaps can you give some sort of commentary on where vitamin D pricing is going in the U.S., given I think from your perspective, it's probably pretty much reached a floor at this point in time now. Also, just with regards to now the potential for the menu, is QuantiFERON included within discussions at the moment you're having, or is that potential upside or additional use beyond the current discussions that are happening?
Just two quick financial ones. The other non-recurring expense seemed quite high in the fourth quarter. I think there was almost EUR 4 million of charges, but equally, there was quite a positive other operating income on a recurring basis in the fourth quarter. I just wondered if you could possibly square that for us to help better understand that other operating line. Also, just on FX, thanks for the clarity on the EUR 2 million to EUR 2.5 million impact on revenues. Is it possible to give us the impact on EBITDA of every $0.01 move? Thank you.
Yes, Peter, let me take the first two ones. As you can imagine on the big contracts, we said that we have three major agreements worldwide with three major lab chains, two in the U.S. and one global, which I think without giving names, they are quite easily identified. We also stated, what we can state publicly is that one contract was expiring at the end of December 2018 and two contracts in between 2019, but also some part of the contract actually was extended in 2021. As far as these contracts, one done, sealed, discussed. Obviously, with these very large customers, when a contract renewal is always associated with some sort of price concession. It's not necessarily linked to vitamin D or a specific product. It's simply a price concession that is discussed generally on the book of business.
What we have always been able to do so far has been to actually compensate the effect by adding more products to the catalog. In this specific case, the compensation, since with this account, there is already a broad use of all our immunoassay products, we are actually able to get on contract with a significant number of molecular products, especially ASR, because this very large account actually
Use components to develop LDT tests. That actually worked very well also because for us, the ASR business is also a very profitable business. Talking about vitamin D and vitamin D prices. Again, in general, again, nothing to do with the price specifics per se, renewal in this world means commitment and discount. If we talk about, is there a floor price for vitamin D? There is never a floor price for anything. In our business, unfortunately, pricing is going down, and certainly for certain commodities, and vitamin D, as we discussed many times, is a commodity. The price decline, in general, is steeper. However, again, we have a good mix of specialty assays with these labs that are less affected usually by this price pressure.
Overall, I think that the magic here with this relationship has always been to make them comfortable with pricing and add business at least to compensate the concession. This kind of business with these very large labs is fundamental for two reasons. One is that from a volume perspective, it sustains the manufacturing site. Two, from a visibility perspective, being one of the premium suppliers to these labs is adding credibility vis-a-vis all the other customers. I think I will leave to P.G. to comment on your technical questions on financial items.
Thank you, Carlo. Hi, Peter. Your first question on the second one actually was about the effects impact at the EBITDA level. We said at the revenue level, one dollar cent movement means, for us, 2 to EUR 2.5 million lower or higher revenues. This translates at the EBITDA level, give or take, to EUR 1 million. 2 to EUR 2.5 million for revenues, about EUR 1 million for EBITDA. Regarding the other non-recurring expenses, Q4 last year was heavily hit by the fact that that was the quarter in which we decided to shut down the Irish manufacturing site, and that is the quarter where we booked, give or take, EUR 10 million of costs related to the divestiture of that site. This year, you actually have a positive impact because on one side, you don't have the Irish, let me say, one-off expenses.
On the other side, we released some bad debt provision because we are very diligent in the way in which we manage our collection, our DSO pretty good, and it came out that eventually, we were a little bit too prudent, too conservative last year. When reviewing the position at the end of this year, we released some bad debt provision because we actually were able to collect this money.
That's great. Thank you.
Thank you.
The next question is from Daniel Baldini with Oberon Asset Management. Please go ahead.
Hi, good afternoon. Thanks for taking my call. It's a question again about these contracts. Back in November of last year, Quest had an analyst day, and this fellow, James Davis, the EVP of diagnostics, got up and said the following, I'll just read from the transcript. He said, "There's about 73 distinct immunoassays in the company that we offer, and we do that work on six different or seven different platforms that we get from six different suppliers. You know these suppliers: it's Roche, it's Siemens, it's Beckman Coulter, it's Danaher, it's DiaSorin. Why did we go with six suppliers for all these tests? It's how the industry evolved. For example, the first vitamin D testing was done by DiaSorin, and we had to buy their platform in order to do it.
As this industry has matured, Roche can now do everybody else's immunoassays. DiaSorin can do a bunch of other folks' immunoassays. Beckman Coulter can do everybody else's immunoassays. We don't need these seven platforms anymore. We run a competition. We're going to get it down to one supplier. We're going to save a lot of money as we work the competitive nature of the deal that we put in front of these suppliers." Let's assume that he's being truthful and that Quest is one of these contracts that's coming up. They do, in fact, run this competition, and they decide to go with someone else's, what they're calling, platform. Does that mean you lose all of the sales of immunoassays to Quest?
I don't know. You are asking a question and then giving yourself the answer. Yes, absolutely.
No.
Listen.
No, because he's saying that basically, these platforms are interchangeable now.
Okay. I see.
If they decide to go with Beckman Coulter, can you still sell them your immunoassays?
Okay. Without getting into the specifics, but as you know, we supply to the big labs vitamin D and 18 other products. I think it's fair to say that vitamin D is a commodity, and vitamin D actually today can be offered by seven suppliers in the U.S. It is true, by the same token, that on the other products are not really available on many other platforms. In fact, these are the so-called esoteric assays, which is good for us and good for the lab. Let me remind you why these big labs work with DiaSorin, and they like us. We provide them assays where they make a lot of money. Right? My point is, as far as what Quest is commenting, is fair square that today they have different suppliers.
It is certainly true that they are making an effort, and it's public information, to square their operation and make it more efficient. They are building a big site with automation. As a result of that, they're going to consolidate suppliers. Is DiaSorin really going to lose all the business with them in a catastrophic event? I consider this possibility very remote. Is vitamin D up for grab in this contract? Absolutely is up for grab. I think these labs look at DiaSorin overall as its ability to provide a portfolio of products. Okay. To make a long story short, I think we work one by one. We have done one very well, and now let's work on the other two. In a short answer, I think the risk is associated specifically with vitamin D. With the other products, I don't see the risk.
Also, because at the end of the story is what these labs are saying, "I can use one platform for all," is actually incorrect. I think it would be more incorrectly interpreted by the one that read the statement. It means that if you look at a new assay routine and you look at the high volume today, there are a number of companies that can provide that with the necessary throughput. That is certainly true that Beckman, Siemens, Abbott, Roche, have the ability to compete for that bulk of volume. Funny enough, today, when you walk into this lab, but not specifically Quest only, you find that they have platforms from these suppliers that do actually overlap. Okay. When it comes to the esoteric, believe me, I think that it's not only DiaSorin.
There are other companies in other specialty niches that are there, and will stay there to support that side of the business. Is that good enough for you as an answer?
Yes, that's wonderful. Thank you.
The next question is from Maja Pataki with Kepler Cheuvreux. Please go ahead, madam.
Yes, good afternoon. Hi, Carlo. You were very specific on trying to give us an indication how you think about the lower end and the upper end of the guidance. That's really helpful. I was just wondering, since you mentioned the TB test in Europe as a positive in Q4, would you be able to give us a bit more understanding how big that was? How much of a difference it means for you if the QuantiFERON TB test was the only approved in the U.S., let's say, in Q4? Would that be meaningful on the guidance? The second question, just to get back on the question before with contract renegotiations. You have a very strong foothold with clients because of your specialty tests. I'm just trying to understand your thinking.
Is there a level of pricing on vitamin D or pricing pressure on vitamin D where you would say, "You know what? That's actually fine for us. We don't need to do that. We're happy to supply you the specialty tests." Or is vitamin D so profitable for you that even another 10%-20% discount or discount on the price would be totally fine for you to continue the business? Thank you.
Okay, Maja. QuantiFERON, as you could appreciate the fact that is a very sensitive product for QIAGEN and for us, cannot comment really on the amount. What I'm saying is that the intention to work with QIAGEN was to increase the speed of adoption of blood testing versus skin testing. The second thing was to try to decentralize this testing, which today is very centralized because of ELISA technology. That would be a win-win for both companies, because the decentralization means a higher price and more secure business. More adoption means increasing volume. This is what the two companies are working on, and it is working very well in Europe. Now, let's talk about the U.S.
U.S. is even more so because, again, by nature of business, of the way the U.S. market is shaped, a lot of this volume today is actually sent out to the big labs. Simply because the hospital market doesn't want to do ELISA any longer, and it was more convenient for them to just to send it out. For the U.S., the QuantiFERON for DiaSorin is very strategic for a different reason. It's strategic because it will allow us to go after the send-out business and increase footprint in the hospital market that, as you know and we have discussed today, is the Achilles heel of the DiaSorin strategy, because we've been very successful in centralized commercial labs. We have been not so successful in addressing the hospital market, which is a vast opportunity at this stage. Again, you understand the strategic importance.
The data shows, I cannot give you precise data, you see that Europe is going well for us, way above everybody else. QuantiFERON is one of the drivers. As far as contracts, yes, indeed, we are esoteric suppliers, and vitamin D was an esoteric test. Today, vitamin D, our presence in these labs clearly has increased in strategic importance because we provide vitamin D and others. This is why I'm not so concerned about being wiped out by the big labs. We will stay there with all these products. Just to give an example, and also to answer to Peter, we just got approval in the U.S. of the stool assays. These are very, today, very concentrated products as a send-out in the big labs, we certainly are in discussion with them about bringing over to them this product. Which are esoteric specialties.
Jim Davis' comment, I think, is a general comment saying, "Hey, high volume routine has to be streamlined and brought together in a more efficient way," and that's certainly true. Vitamin D is going to be up to us and up to them to decide whether it goes on the streamline or it stays in DiaSorin as part of the package. As far as pricing of vitamin D, absolutely. There is a level where we are not available to go, but I'm not necessarily sure it's a matter of profitability, but it's a matter of company image. Because there are certain companies, mainstream, high volume, that pretty much, it can be an add-on at any price and is additional. It's stability, it's absorption, and the big investment they need to make to provide all the hardware necessary to serve these big labs.
For us, it's a matter of, there is a limit under which we don't want to go. Also because we sell to everybody else at a different price. I don't understand why a specific account should be different.
Thank you very much.
As a reminder, if you wish to register for a question, please press star and one on your telephones. The next question is from Bruno Permutti with Banca IMI. Please go ahead, sir.
Good afternoon. I have three questions. The first one relates to the QuantiFERON launch in the U.S. I was wondering which are the worries which you could have on possible approval by the second quarter. If you can update us on how the process is going and what are exactly your expectations. The second one relates to possible partnership similar to that you signed with QIAGEN. I was wondering if you are considering possible collaboration and partnerships in your strategy, and if you see something going on, possibly this year. The third one relates to an update, if it is possible, to the LIAISON XS launch in the U.S.
Yes. The concern I have with the FDA is the FDA. Meaning that it's a third party, it is a PMA, there is a process, and there is a reviewer. Therefore, it depends on, usually the reviewer. There is no file, in my experience, that goes through the FDA without questions. The problem usually is if these questions require experimental work and generation of data by the company to be addressed. And we don't know, because the FDA, after we file, usually has 90 days to review the file and come back with comments. We're still within the 90 days period. That's a concern. You don't control them. They decide what they will do with the file. We need to wait and see, and see if it's going to work within our expectations or not.
As far as the LIAISON XS launch, I think you're probably asking LIAISON XS launch per se, not necessarily in the U.S., because in the U.S. there is a delay, 2020. The instrument is commercialized in Europe, and we have a big event where we launch the system, which is going to happen actually in Italy in May with over 1,000 customers attending. This is the commercial launch of the platform. In the U.S., there is a delay because of regulatory constraints. The box has to be registered. It's a 510(k), not so complicated. We expect registration and launch to happen beginning of next year. Last but not least, partnerships, as we said, today we have three. One with BRAHMS PCT, one with Meridian Stool, and then we have this new venture with QIAGEN. We don't have today I'm sorry, and then certainly with Beckman.
We don't have today any specific mention about partnerships because we are certainly very busy delivering on the existing ones. I think that what I need to comment is the strategic nature of the relationship with QIAGEN, because together, the two companies, after this initial effort, we understood that our platforms and our technologies work very well with developing a T cell catalog of products. Again, it's not a secret, also because it was published by a German newspaper, that we're working on Lyme disease, which is a very sizable market. Just for your understanding, there are five million tests on Lyme disease in the U.S. and almost 15 million in Europe that today are done with immunoassays. We own roughly 40%-50% market share there with immunoassays, and certainly that's a very nice business, fully incremental for DiaSorin QIAGEN.
We are actively working together to try to bring this product to the market as soon as we can. There is a commitment by both companies to extend the range of products that measure interferon and can be actually all put on the XL and the XS systems.
Thank you.
For any further questions, please press star and one on your telephone. Mr. Rosa, there are no more questions registered at this time.
Thank you, operator. Thanks, everybody.
Ladies and gentlemen, thank you for joining. The conference is now over. You may disconnect your telephones. Thank you.