Catalent is preparing for a complex therapy boom with $ 1.2 billion purchase of Paragon

Catalent has entered into an agreement to purchase Paragon Bioservices, a contract development and manufacturing organization specializing in complex biopharmaceutical products.

This $ 1.2 billion deal will give Catalent an immediate boost for specialty drugs such as cell and gene therapies, while drug manufacturers are investing heavily in the development of these new drugs.

Paragon, backed by private equity firms Camden Partners and NewSpring Capital, helps clients develop and produce gene therapies, next generation vaccines and other complex biopharmaceuticals such as oncolytic viruses and therapies CAR-T cell, which according to Catalent is "one of the fastest growing areas of health. "

The CDMO has more than 25 years of experience in producing gene therapies, including adeno-badociated virus (AAV) vectors, the most commonly used delivery system, as well as plasmid vectors and lentivirals, and 50% of all its work is done in the gene therapy area. It forecasts sales of about $ 200 million in 2019.

This is little in comparison to Catalent 's revenues of about $ 2.5 billion last year from the sale of capsules, biologics and specialty drug discovery, drug sales, and more. Oral drug delivery and clinical delivery services, but the outsourcing giant is now in a new, booming category that is expected to grow in a $ 40 billion market in the coming years.

The agreement comes from a kind of buying frenzy in gene therapy among major pharmaceutical companies trying to position themselves in the market.

Last month, Pfizer paid about $ 640 million for a 15% stake in Vivet Therapeutics, while Biogen bought Nightstar Therapeutics for $ 800 million. and Roche acquired Spark Therapeutics in February for $ 4.3 billion. And in 2018, Novartis bought AveXis for $ 8.7 billion to claim Zolgensma, a gene therapy for the treatment of spinal muscular atrophy (SMA). In 2016, Pfizer paid $ 645 million for Bamboo Therapeutics.

The FDA recently announced that it hopes to receive up to 200 applications to begin gene and cell therapy trials each year starting in 2020.

"Paragon's unparalleled expertise in the rapidly growing gene therapy manufacturing market will be a transformative badet for our company, which we believe will accelerate our long-term growth," said John Chiminski, General Manager, Catalent. .

"Paragon brings a complementary capability to Catalent that will fundamentally improve our end-to-end biopharmaceutical business and end-to-end biopharmaceutical solutions for our customers."

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