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Thermo Fisher: $7.2bn Patheon sits in sweet spot for bioproduction business

Dan Stanton

By Dan Stanton+

17-May-2017

Image: iStock/designer491
Image: iStock/designer491

Thermo Fisher says Patheon will become the most competitive biologics CDMO in the market through direct access to its bioprocessing technologies and capabalities.

This week , Thermo Fisher confirmed plans to buy contract development and manufacturing organisation (CDMO) Patheon with debt of $5.2bn (€4.7bn) and $2bn in equity.

And speaking on an investor call to discuss the deal, Thermo Fisher CEO Marc Casper said Patheon and its position in the CDMO market “fits right in the sweet spot of what our bioproduction business does.”

Thermo Fisher is a major life science tools and tech firm, and one of a handful of players which supply biomanufacturers with single-use equipment and systems.

“With seamless access to our bioproduction capabilities, Patheon's biologics development and manufacturing capabilities will provide even greater benefit for customers,” Casper said. “Thermo Fisher's bioproduction business will also benefit from having an in-house world-class showcase for our technologies.”

Small to mid-scale single-use production

According to Casper, Thermo Fisher is “a leader in the single use technologies for the small to mid-scale production of biologics,” the scale at which Patheon has been growing its biologics business.

Patheon entered the biologics sector in 2014 through its $2.65bn merger  with DSM’s pharmaceutical product business and bolstered the business with the subsequent acquisition of Gallus Biopharmaceuticals .

The firm now has biologics facilities in Brisbane (Australia), Groningen (the Netherlands), and US sites in New Jersey and Missouri, focusing predominantly on clinical manufacturing but beginning to move towards commercial scale production.

According to Casper, the CDMO has already spent around $50m on processing equipment from Thermo Fisher.

“The companies collaborate well, and that will create new opportunities, because effectively, we'll become smarter as a bioproduction producer by having a sister business that is doing this every day,” he told stakeholders.

“We'll have a showcase facility to demonstrate for customers. And the biologics business will have access to our technologies and capabilities to make sure that they are most competitive in the market. So it's a really unique opportunity.”

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