WILMINGTON, MA — Charles River Laboratories International, Inc. announced Wednesday that it has acquired Oncotest GmbH, a Freiburg, Germany-based contract research organization (CRO) providing discovery services for oncology, one of the largest therapeutic areas for bio-pharmaceutical research and development spending. Oncotest offers an integrated portfolio of target discovery and validation services for preclinical oncology researchers. The company specializes in in vivo pharmacology services, leveraging an extensive collection of more than 400 patient-derived xenograft (PDX) tumor models, as well as a full range of in vitro assays using both commercially available and proprietary PDX-derived cell lines.
Integrated with Charles River’s broader portfolio of human xenografts, syngeneic, and humanized immunotherapy research models, flow cytometry, and IVIS® imaging services, the acquisition creates a premier oncology portfolio for the validation of novel cancer therapies. With facilities in both North America and Europe, Charles River’s enhanced capabilities will enable us to provide expert support for our clients’ drug discovery programs, including: compound design and synthesis, hit-to-lead, high throughput screening (HTS), and lead-to-candidate services. When combined with Charles River’s safety assessment services, we provide unparalleled support from early discovery through preclinical development, enabling clients to bring new oncology therapies to market in a more efficient and timely manner.
James C. Foster, Chairman, President and Chief Executive Officer of Charles River said, “Global biopharmaceutical clients are increasingly demanding a full suite of oncology capabilities from a single partner, including PDX tumor models, cell lines, imaging services, and immuno-oncology tools. With Oncotest GmbH, Charles River Discovery Services now has one of the most comprehensive and translational portfolios of oncology discovery services in the early-stage CRO industry.”
Financial and Transaction Details
The purchase price was approximately €34 million in cash (approximately $36 million based on current exchange rates), subject to certain post-closing adjustments. In addition to the initial purchase price, the transaction includes a potential additional payment of €2 million based on future performance (approximately $2 million based on current exchange rates). The purchase price implies a multiple of approximately 11x adjusted EBITDA based on the trailing twelve months ended September 2015.
The acquisition will have a negligible impact on Charles River’s consolidated revenue and non-GAAP earnings per share in the fourth quarter of 2015. In 2016, Oncotest is expected to represent approximately 1% of Charles River’s consolidated revenue and be neutral to slightly accretive to non-GAAP earnings per share. Items excluded from non-GAAP earnings per share are expected to include all transaction-related costs, which primarily include amortization of intangible assets and certain third-party integration costs.
Oncotest has become part of Charles River’s In Vivo Discovery business, which is reported in the Discovery and Safety Assessment segment.
About Charles River
Charles River provides essential products and services to help pharmaceutical and biotechnology companies, government agencies and leading academic institutions around the globe accelerate their research and drug development efforts. Our dedicated employees are focused on providing clients with exactly what they need to improve and expedite the discovery, early-stage development and safe manufacture of new therapies for the patients who need them. To learn more about our unique portfolio and breadth of services, visit http://www.criver.com.
(NOTE: The above press release is from Charles River Labs.)
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