Thermo Fisher Bolsters Clinical Research Services with $17.4 Billion Acquisition of PPD

Biotech giant Thermo Fisher Scientific intends to finish the year strong, announcing the completion of its $17.4 billion acquisition of PPD Inc, a global Contract Research Organization (CRO) headquartered in North Carolina, USA. The M&A is Thermo Fisher’s third this year.  

Thermo Fisher entered talks with PPD earlier this year, with an offer of $47.5 per share, a 24% premium on PPD’s closing stock price of $38.49, as on April 13, 2021. The proposed merger boosted PPD’s stock price by 17% in April. 

“We are very excited to officially welcome our PPD colleagues to Thermo Fisher Scientific,” said CEO Marc N. Casper. “Expanding our value proposition for our biotech and pharmaceutical customers with the addition of PPD’s leading clinical research services advances our work in bringing life-changing therapies to market, benefiting patients around the world.”

In connection with the completion of the transaction, PPD’s common stock ceased trading on Nasdaq prior to the opening of trading on December 8, 2021. PPD will become part of Thermo Fisher’s Laboratory Products and Services Segment.

PPD Inc Brings Expertise in Clinical Research

PPD, which began as a consulting firm in 1985, is a global CRO that provides a wide range of clinical research services from early preclinical development, Phase 3 trials, pharmacovigilance to regulatory compliance. With multiple research facilities and over 26000 employees across the globe, PPD is a leader in the $50 billion CRO industry. PPD was named the ‘best vaccine CRO of the year’ in Asia Pacific in 2021. They registered a revenue of approximately $4.5 billion in 2020 and 26.5% growth in the third quarter of 2020.

Taking Stock of Thermo Fisher’s Mergers

Thermo Fisher has had a busy 2021 with some promising partnerships, post-setback of a deal with Qiagen falling through in 2020. In the post-Covid world, with pharma and biotech emerging as fast-growing sectors, Thermo Fisher strategically invested in two clinical research companies- Henogen, in Belgium, a low-lost contract manufacturing organization with expertise in viral-vector development, and Mesa Biotech, a San-Diego based medical diagnostic company that made hand-held Covid-19 testing kits.

With an annual revenue of $35 billion and 9% growth in the third quarter of 2021, Thermo Fisher is investing in increasing scientific and manufacturing capabilities. After the $879 million buyout for Henogen and $450 million acquisition of Mesa Biotech in April 2021, Thermo Fisher acted quickly to expand its healthcare repertoire, beyond fighting Covid-19. With several candidate products and therapies in development, its latest addition of PPD makes Thermo Fisher equipped to enhance its scientific portfolio and clinical development spectrum- from early discovery to regulatory testing, manufacturing and logistics. 

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Author

Sahana Shankar