In This Report

• M&A

• Top Headlines

• Dynamk Insights

• VC Investments

• Recommended Reads

Q1 saw strong M&A activity in Life Science Industrials (including services) and an outlier acquisition of PRA Health by ICON for $12BN. Large, noteworthy deals include the Charles River acquisition of Cognate BioServices for $875M (Link), and Thermo adding viral vector capacity with an $878M Novasep acquisition (Link).

Top Headlines

Charles River Acquires Cognate Bioservices for $875M

On March 29, 2021, Charles River completed the acquisition of Cognate Bioservices, a leading Contract Development and Manufacturing Organization (CDMO). The acquisition was on top of earlier announcements around capacity expansion at Cognate's Memphis, Tennessee site (Link). The acquisition establishes Charles River as a premier scientific partner for cell and gene therapy development, testing, and manufacturing, providing clients with an integrated solution from basic research and discovery through CGMP production (Press Release)

Thermo Fisher Adds Capacity via $875M Novasep Acquisition
Thermo beefs up viral vector manufacturing capacity with Novasep's viral vector business. The deal bolsters Thermo Fisher’s gene therapy capabilities, adding 7,000 square meters of manufacturing space and 400 staff through three facilities at two locations in Seneffe and Gosselies, Belgium. (Details)

Dynamk Insights

COVID-19 Windfall Continues to Drive Life Science Industrials (LSIs) Market while Strategics Make Long Term Plays

Last quarter we noted that 2020 was an exceptional year for Life Science Industrials with over $7.4B invested outpacing 2019 by 35%. Meanwhile, large strategic players like Danaher continue to see COVID windfall and have placed an estimate of $1.3 billion in COVID-related vaccine and therapeutic revenues for 2021 from Pall and Cytiva, “roughly twice the amount” recognized in 2020. A few noteworthy observations in Q1 indicates there is confidence in continued growth in the LSI segment:

• VCs making more late-stage investments in Q1 in relation to Seed or Early Stage over Q4 2020, a good indication of investor confidence.

• Dynamk has also observed an increase in the size of rounds and shorter time between rounds raised.

Meanwhile, industry leaders continue to build out their long-term strategy including investments in cell and gene therapy. Charles River, Rentschler, Thermo Fisher, and WuXi are all investing in capacity and services through acquisitions and expansions to the tune of ~$3B combined, see recommended reads section for details.

Venture & Growth Investing in Life Science Industrials

1Q-2021 investment volume is continuing the strong momentum in the sector, on par with an exceptional Q4, and over 3X the investment volume of 1Q-2020.

Q1 funding reflected continued heavy investment in growth, later stage and pre-IPO funding in the Life Science Industrials with a slight reduction in early stage funding.

Dynamk Recommended Reads

Business 

• Bio-Techne, Fresenius Kabi, and Wilson Wolf create 3 party JV to reduce gene therapy manufacturing costs

• Cytiva adds aseptic filling to growing portfolio with Vanrx Pharmasystems acquisition

• Danaher continues to see COVID windfall and estimates $1.3B in related revenue for 2021 from Pall and Cytiva

• WuXi AppTec completes acquisition of OXGENE to further strengthen cell and gene therapy service offerings

• Mettler-Toledo expands sensor offering with PendoTECH acquisition

Manufacturing

• Rentschler catapults into the cell and gene therapy space through UK investment

• National Resilience adds capacity with the acquisition of a Sanofi site in Boston

• CDMO Lakes Bioscience to build $490M mAb production site at former GSK UK site

• Fujifilm to invest $2B in end-to-end single-site solution to meet CDMO capacity demands

• Thermo Fisher rolls out 3,000 and 5,000 L single-use bioreactors

Research and Development

• Roche partners with the University of Leeds in developing AI to identify cancer treatment

• Thermo Fisher's new human plasma-like cell culture media forecast to be game changer

• Repligen and Navigo target next-wave COVID vaccines with affinity resin

*Reported transaction amounts and timing are subject to change dependent on final closings.