Charles River Laboratories (CRL) to Acquire Vigene Biosciences for $292.5M
- Pre-Fed jitters keep S&P 500, Nasdaq below record highs
- Oracle (ORCL) Tops Profit and Sales Views But Stock Falls on Guidance Miss, Analysts Still Raise PTs
- General Motors (GM) to Boost EV and AV Investments to $35 Billion Through 2025
- Oil hits new high near $75 on demand rise, falling inventories
- Roblox (RBLX) Lower as DAUs Fall Sequentially
Get instant alerts when news breaks on your stocks. Claim your 1-week free trial to StreetInsider Premium here.
Charles River Laboratories International, Inc. (NYSE: CRL) announced today that it has signed a definitive agreement to acquire Vigene Biosciences, Inc., a premier, U.S.-based gene therapy contract development and manufacturing organization (CDMO) providing viral vector-based gene delivery solutions. The purchase price is expected to be $292.5 million in cash, subject to customary closing adjustments. In addition to the initial purchase price, the transaction includes contingent additional payments of up to $57.5 million based on future performance. The transaction is expected to close in the beginning of the third quarter of 2021, subject to regulatory requirements and customary closing conditions.
James C. Foster, Chairman, President and Chief Executive Officer of Charles River Laboratories, commented, “The addition of Vigene Biosciences’ extensive gene therapy expertise will enable us to expand our comprehensive cell and gene therapy portfolio to span each of the major CDMO platforms – cell therapy, viral vector, and plasmid DNA production. In these emerging, high-growth, value-added segments, we intend to continue to differentiate ourselves by bringing our high-science, customizable approach to support the complex needs of cell and gene therapy developers and innovators worldwide. Our goal is to become our clients’ scientific partner of choice for advanced drug modalities from discovery and non-clinical development to CGMP manufacturing. We look forward to welcoming Vigene’s dedicated employees to the Charles River family.”
The acquisition of Vigene Biosciences will enhance Charles River’s gene therapy capabilities in the high-growth, value-added cell and gene therapy CDMO sector.
- Expands Charles River’s Gene Therapy CDMO Capabilities for Viral Vectors and Plasmid DNA – Vigene offers its clients contract manufacturing solutions across several key gene therapy platforms, enhancing Charles River’s ability to meet its clients’ evolving scientific needs. Its primary area of expertise is CGMP viral vector manufacturing, which is used for gene therapies and gene-modified cell therapies. Vigene has significant expertise in adeno-associated virus (AAV) CGMP production, which is the most commonly used delivery solution for gene therapies, as well as for other major viral vectors, including lentivirus. Vigene also offers high-quality, research grade and CGMP plasmid DNA, which is a foundational tool used in the development of viral vectors for gene-modified cell therapies, gene therapies, and vaccine production.
- Complements Charles River’s existing non-clinical development and manufacturing portfolio – The addition of Vigene will be complementary to Charles River’s existing, non-clinical development and manufacturing capabilities and provide clients access to a comprehensive cell and gene therapy solution. With operations based in Rockville, Maryland, Vigene will geographically expand and be highly complementary to Charles River’s existing gene therapy CDMO capabilities in the United Kingdom and Sweden, which were acquired through the March 2021 acquisition of Cognate BioServices. Vigene will also support Charles River’s existing, U.S.-based cell therapy production capabilities and establish an end-to-end, gene-modified cell therapy solution. In addition, the acquisition will enable clients to seamlessly conduct analytical testing, process development, and manufacturing for advanced modalities with the same scientific partner, enabling them to achieve their goal of driving greater efficiency and accelerating their speed to market for advanced drug modalities.
- Enhances Charles River’s growth potential with increased exposure in the high-growth market sector – Vigene will enhance Charles River’s growth potential by expanding Charles River’s portfolio of comprehensive cell and gene therapy solutions with viral vector and plasmid DNA manufacturing. The addressable market for cell and gene therapy CDMO services, principally for cell therapy, plasmid DNA, and viral vector production, is currently estimated at approximately $2.5 billion globally and is expected to grow at least 25% annually over the next five years.
- Expected to drive profitable growth and shareholder value – The acquisition is expected to generate attractive financial returns that are consistent with Charles River’s disciplined investment criteria. It is also expected to be accretive to Charles River’s long-term revenue and earnings per share growth. Vigene is expected to generate annual revenue of $30 to $35 million in 2021, and is expected to grow at least 25% annually over the next five years.
Additional Financial and Transaction Details
Based on the anticipated completion of the acquisition in the beginning of the third quarter, Vigene is expected to add approximately 50 basis points to Charles River’s reported revenue growth rate in 2021. The transaction is expected to be neutral to non-GAAP earnings per share in the first full year after the acquisition closes, and accretive thereafter. Items excluded from non-GAAP earnings per share are expected to include all acquisition-related costs, which primarily include amortization of intangible assets, advisory fees, certain costs associated with efficiency initiatives, and certain third-party integration costs.
The acquisition and associated fees are expected to be financed through Charles River’s existing credit facility and cash. Vigene is expected to be reported as part of Charles River’s Manufacturing segment.
Davis Polk & Wardwell LLP is acting as Charles River’s transactional legal counsel, and Weil, Gotshal & Manges LLP is acting as antitrust counsel.
Vigene Biosciences is supported by its institutional investor, Signet Healthcare Partners. Robert W. Baird & Co. is acting as the exclusive financial advisor, and Shulman Rogers and Sheppard Mullin Richter & Hampton LLP are acting as legal counsel to Vigene.
Serious News for Serious Traders! Try StreetInsider.com Premium Free!
You May Also Be Interested In
- At Home Group (HOME), Hellman & Friedman Amend Definitive Agreement to Increase Offer Price to $37 Per Share
- Creatd Announces its Intent to Purchase a Majority Stake in Influencer Talent Management Firm, WHE Agency
- MagnaChip (MX) Falls After Being Told to Pause Merger Amid CFIUS Review
Create E-mail Alert Related CategoriesCorporate News, Management Comments, Mergers and Acquisitions
Related EntitiesRobert W Baird, Earnings, Definitive Agreement
Sign up for StreetInsider Free!
Receive full access to all new and archived articles, unlimited portfolio tracking, e-mail alerts, custom newswires and RSS feeds - and more!