The $21.4 billion addition of GE Healthcare’s Biopharma business will complement Pall’s technologies to bring biomanufacturers a fully end-to-end bioprocessing offering.
BioProcess Insider reported the news that Danaher Corporation has agreed to buy the Biopharma division of GE Healthcare’s Life Sciences business for approximately $21.4 billion (€18.9 billion) on Monday.
If the deal is completed, it will be the biggest merger in the bioprocessing space, dwarfing Danaher’s previous $13.8 billion takeover of Pall Corporation in 2015, and the similar size acquisition of Life Technologies by Thermo Fisher in 2014.
It will also bring Danaher a full end-to-end bioprocessing offering for the biopharma industry, essentially adding to Pall’s up and downstream technologies and filling in the gaps around them.
In the upstream, Pall offers a range of single-use bioreactors, while in the downstream Pall’s chromatography technologies place it among the strongest position on the filtration side of the industry. The firm is also heavily invested in continuous technologies.
GE’s business brings a range of products encompassing the AKTA, Hyclone, Wave, Xcellerex brands and more.
These include – in the upstream – buffers and process liquids, media and feeds, microbial fermenters, rocking and stirred-tank bioreactors, microcarriers, reagents and supplements, and animal and xeno-free based sera. In the downstream, GE offers technologies that include normal and tangential flow filtration, and a range of chromatography hardware, software and resins.
GE also has an off-the-shelf, modular biologics factory platform in the form of KUBio, which offers biomanufacturing ‘pop-up’ biologics production facilities that can be constructed, assembled and fully fitted-out to current Good Manufacturing Practices (cGMP) standards in approximately 18 months, up to half the time of traditional builds. It boasts Lonza, Beigene, JHL Biotech and Pfizer among its clients.
“The deal checks all the boxes for an attractive Danaher target: leading brand, high gross margins (>60%), high recurring revenues (75%), with powerful secular growth drivers,” Jefferies’ analyst Brandon Couillard said in a note.
“Combined with Pall’s approximate $1 billion Biopharma unit, the deal will solidify Danaher as the biggest global player in bioprocessing. The move will lift its Life Sciences unit to approximate $10 billion.”
Evercore ISI analyst Ross Muken also noted the strength of the deal for Danaher’s growth in the bioprocessing sector.
“There is no other way to phrase it – this was the best case scenario for Danaher shareholders, “ he said. “Management was able to acquire a high growth, marketing leading business, in a super attractive end market segment (bioprocessing) that they already know well (given Pall) for a multiple below what some ‘peers’ trade at on a standalone basis.”