The $800m (€648m) acquisition will add drug safety, testing, and discovery services to Charles River’s offerings, as well as a one-million sq. ft. facility in Michigan, US.
According the CEO Jim Foster, the site will help Charles River meet growing demand.
As pharma companies increasingly rely on outsourced services to improve efficiency and access to expertise they no longer maintain in-house, Charles River need additional capacity to accommodate the demand, he told investors earlier today.
“For that reason, the acquisition of MPI Research is particularly opportune.”
The acquisition of MPI – which shares a similar client base of mostly small and medium-sized biotech clients – expands Charles River’s capabilities in a few new areas, and boosts current offerings, said Foster.
“MPI will add ototoxicity and abuse liability capabilities, and expand Charles River’s existing capabilities in general toxicology and specialty toxicology, including ophthalmology, juvenile toxicity, molecular biology, and surgery, as well as medical device testing,” said Foster.
The deal is subject to regulatory approvals, but Charles River expects to close the acquisition in the second quarter of 2018.
According to Charles River, the acquisition is part of a five year strategy to increase scope.
“We plan to nearly double in size over the course of our five year plan,” said Foster.
A spokesperson also told us the CRO believes “growth is an integral part of being an industry-leader.”
“M&A provides us the opportunity to be more relevant to our customers – we grow to strategically enhance our portfolio and are always evaluating what needs exist in the market,” the spokesperson added.
In August last year, the CRO acquired Brains-On-Line to boost drug discovery capabilities, and in January, 2018 it expanded immunology contract research services with the acquisition of UK-based KWS BioTest.
The spokesperson told us the merger will add value for Charles River’s shareholders.
“The proposed acquisition of MPI will enhance Charles River’s access to growing end markets, builds scale to meet demand, and augments our scientific bench strength, providing a compelling value proposition for both clients and shareholders,” we were told.