Thermo Fisher Scientific (a global firm that provides instruments, consumables, services, and other products to pharma and other industries) announced its board has approved an agreement to acquire contract research organization (CRO) PPD for a total cash purchase price of $17.4b USD. In addition, the purchasing company has agreed to assume PPD’s net debt, estimated at $3.5b.
Marc Casper (chairman, president, and CEO of Thermo Fisher Scientific), said the move comes at a time when pharma/biotech end market is the company’s largest, fastest-growing end market.
“The acquisition of PPD is a natural extension for Thermo Fisher and will enable us to provide these customers with important clinical research services and partner with them in new and exciting ways as they move a scientific idea to an approved medicine quickly, reliably, and cost-effectively,” Casper remarked. “Longer term, we plan to continue to invest in and connect the capabilities across the combined company to further help our customers accelerate innovation and drive productivity while driving further value for our shareholders.”
PPD provides an extensive list of clinical research and laboratory services geared toward aiding customers in drug development. The company employs more than 26,000 people in nearly 50 countries and generated $4.7b in revenue last year. When the transaction wraps, PPD will become part of Thermo Fisher’s Laboratory Products and Services Segment.
David Simmons, PPD’s chairman and CEO, said, “Thermo Fisher is a world-class company with a very similar culture and values and will provide a great foundation for our colleagues to continue to deliver for our customers and to develop their own skills and careers.”
Casper added, “Both companies have complementary mission-driven cultures, and I can’t wait to welcome PPD’s colleagues from around the world to Thermo Fisher once the transaction is completed.”
According to Thermo Fisher, the move will help establish the company as a leader in the high-growth clinical research services field. Additionally, the joining of the two firms reportedly will serve to enhance Thermo Fisher’s value proposition for its pharma/biotech customers by adding complementary services.
Thermo Fisher’s acquisition comes two years after (in 2019) PPD filed for a planned initial public offering (IPO). Then, in February 2020, the CRO set the terms of its IPO plans, announcing its intention to raise $1.5b for a valuation in excess of $9b.
The acquisition is expected to be completed by the end of 2021.