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Q2-2021 Dynamk Life Science Industrials INSIGHTS: Trends, Transactions & Headlines

Dynamk Capital

In This Report

  • M&A

  • Top Headlines

  • Dynamk Insights

  • VC Investments

  • Recommended Reads

The exit environment has been very strong in Q2 2021 breaking both transaction amount and deal count numbers. Whether through M&A, IPO or SPACs, over 41 life science industrial companies saw exits for a total of $32.6B. A few blockbuster deals contributed significantly to this number. ThermoFisher's acquisition of Pharmaceutical Product Development (PPD) for $17.7B continues to validate the strong push for consolidation among life science industrial players. Danaher's acquisition of Aldevron for $9.6B solidifies its position in the cell & gene therapy market. Both the Gingko Bioworks SPAC worth $1.7B valuing the company at $16.7B and Zymergen's $500M IPO valuing the company at $3B further validate the promise of synthetic biology approaches.

Top Headlines

Danaher expands into CDMO space with $9.6B Aldevron acquisition

On June 17, 2021, Danaher announced it will acquire Aldevron from EQT Private Equity. Aldevron manufactures plasmid DNA, mRNA most notably used for COVID vaccines, and proteins for biotech companies from early drug discovery through commercial. The addition of these manufacturing services places Danaher squarely in the CDMO space and reflects the industry need for manufacturing capacity of raw materials for vaccines and other biologics.
Press Release

ThermoFisher acquires contract research organization (CRO) PPD for $17.4B
The announcement made in April significantly expands Thermo's laboratory products and services business. PPD runs clinical studies and offers a range of laboratory services that accelerates getting drugs to market. This move follows an earlier acquisition of PRA Health Services by ICON for $12B, and marks a continuing consolidation trend in the CRO space.
Press Release

Dynamk Insights

CDMOs take center stage as the industry calls for greater manufacturing capacity

The headlines continued all through H1 2021, as large strategics made acquisitions and established Contract Development and Manufacturing Organizations (CDMOs) invest hundreds of millions in expansion projects. Perhaps overshadowed by the recent Danaher / Aldevron acquisition for $9.6B, there were countless other transactions and news in the CDMO space. Charles River brought its M&A outlay to ~$1B with the most recent Vigene acquisition ($292M) shortly after acquiring Cognate Bioservices ($875M) in Q1. Fujifilm Diosynth Biotechnologies announced US expansion plans estimated at $2B. Looking back to Q1 Dynamk noted the Thermo / Novasep acquisition ($875M), National Resilience expansion with the buyout of Ology, and taking over a former Sanofi site in Cambridge. Key drivers for this feverish expansion are the need for manufacturing capacity for critical raw materials used in vaccines such as viral vectors and mRNA as well as the continued shift towards Cell and Gene Therapies. Anticipating this trend, Dynamk has been investing in key enabling technologies used by these CDMOs as they look to increase capacity and reduce manufacturing costs as well as time to market.

Q2 2021 was a record quarter for investments in Life Science Industrials. The amount of venture raised in Q2 surpassed both previous record-breaking quarters by over $1B. In fact, funding raised in H1 of 2021 has nearly eclipsed total funding in 2020.

There were 12 companies that raised +$100M rounds. Key deals include Insitro's $400M series C, Insilico Medicine's $255M series C, and Exscientia $222M series B. All three are developing platform plays that leverage AI to accelerate drug discovery. Benchling's $200M series E shows continued growth in digitalizing lab work, while Resilience's $163M series C further pushes the manufacturing envelope.

Q2 saw the most significant amount of funding going to later-stage VC deals and continues a trend we have been seeing since early 2020. The significant increase in late-stage in Q2 over Q1 2021 can be attributed to the deals highlighted above.

Dynamk Recommended Reads

Business 

Manufacturing

Research and Development


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