CHICAGO, Aug. 13, 2020
/PRNewswire/ -- The push for pharmaceutical innovation has
prompted drug sponsors to streamline their supply chains and
dedicate those resources toward faster product development, which
has propelled growth in the Pharmaceutical Services Outsourcing
industry, according to the Healthcare & Life Sciences
Insider, an industry report released by Brown Gibbons Lang
& Company (BGL). Secular drivers, including increased R&D
spending globally, a growing cell and gene therapy (CGT) pipeline,
and a healthy biotech funding environment, are expected to sustain
market growth. Access the full report here.
The BGL report examines the various markets within Pharma
Services, a fragmented industry that is increasingly moving towards
integrated, single-source solutions as drug sponsors look to cut
time and cost from bringing drugs to market. The report also
features a roundtable spotlight on CGT, a novel field that is
seeing rapid growth and affording opportunities for outsourcing
providers. Executives share insights on developing trends and
future investment in the CGT market.
Sponsor challenges in CGT are translating into opportunities for
outsourcing providers, according to Michael
Khavinson, chief executive officer of Azzur Group and a
participant in the report, "Providers of services and solutions
that result in bringing the manufacturing closer to the patient;
accelerating the start-up, manufacturing, or delivery process; or
facilitate faster turnaround between batches have an opportunity to
help." Khavinson anticipates the CGT sector will see M&A
activity accelerate over the next few years, adding, "M&As will
see an uptick due to the large number of start-ups in the CGT space
in the last few years. Several products in development in the CGT
space are partnerships between companies, some of which will likely
result in M&As."
Vendor consolidation and outsourcing of content from drug
sponsors is driving M&A across the Pharma Services supply
chain, leading participants to seek acquisitions to build
capabilities and serve as end-to-end solutions providers, with
biologics (CGT) among the targeted growth areas. PPD, Charles River, Catalent, Recipharm, and Thermo
Fisher Scientific have been among some of the industry's most
active consolidators. Catalent, a leading publicly-traded contract
manufacturing and development organization (CDMO), is accelerating
growth in biologics through acquisitions (Paragon Bioservices,
MaSTherCell Global), more than doubling its portfolio since 2014.
The company has targeted more than 50 percent of revenue by 2024—up
from 27 percent in 2020.
Private equity groups are attracted to the sector's growth
profile and fragmentation, emerging as buyers in several
high-profile transactions such as Cambrex (Permira Advisers),
Parexel (Pamplona Capital Management), and AMRI (The Carlyle Group
and GTCR). Sponsors have been parties to corporate carve-outs, such
as Altaris Capital Partners (3M Drug
Delivery Systems, n/k/a as Kindeva Drug Delivery) and H.I.G.
Capital (BioVectra) in the CDMO space and Arsenal Capital Partners
(Healthcare Packaging Business of Clariant AG, n/k/a as Airnov
Healthcare Packaging) in Packaging, each announcing the formation
of new growth platforms in Pharma Services over the last six
months.
About Brown Gibbons Lang & Company
Brown Gibbons Lang & Company (BGL) is a leading independent
investment bank and financial advisory firm focused on the global
middle market. The firm advises private and public corporations and
private equity groups on mergers and acquisitions,
divestitures, capital markets, financial
restructurings, valuations and opinions, and other
strategic matters. BGL has investment banking offices in
Chicago, Cleveland, and Philadelphia, and real estate offices in
Chicago, Cleveland, Denver, and San
Antonio. The firm is also a founding member of Global
M&A Partners, enabling BGL to service clients in more than 30
countries around the world. Securities transactions are conducted
through Brown, Gibbons, Lang & Company Securities, Inc., an
affiliate of Brown Gibbons Lang & Company LLC and a registered
broker-dealer and member of FINRA and SIPC. For more information,
please visit www.bglco.com.
View original content to download
multimedia:http://www.prnewswire.com/news-releases/bgl-healthcare--life-sciences-insider--outsourcing-to-accelerate-in-pharma-services-driving-consolidation-301111960.html
SOURCE Brown Gibbons Lang & Company