Baxter sells biopharma services business to PE for $4.25bn

Baxter International will focus fully on medtech after agreeing to sell its BioPharma Solutions (BPS) business to private equity firms Advent International and Warburg Pincus.

Baxter’s BPS unit includes fill/finish manufacturing facilities serving the syringe and vial markets from several locations, including a site in Halle/Westfalen, Germany currently undergoing a $100 million expansion.

The deal, expected to close in the second half of 2023, will see Baxter receive $4.25 billion in cash, which it will use to reduce its debt. The two private equity (PE) firms will run the business as a standalone contract development manufacturing organization (CDMO).

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“Today represents an important step in Baxter’s ongoing transformation journey as we continue to execute against our strategic priorities, enhance our focus and create additional value for all our stakeholders,” Baxter CEO Joe Almeida said.

“Advent International and Warburg Pincus have extensive experience helping innovative healthcare companies advance their mission and strategic priorities. I am confident that under their stewardship, BPS will continue to build on its leadership position, foster world-class talent, invest in new capabilities and capacity, and provide leading-edge, high-quality solutions for its clients.”

The deal represents the end of Baxter in the biomanufacturing space. The firm span out its pharmaceutical product and operations business in 2015 as Baxalta, which was subsequently acquired by Shire for $32 billion. Shire in 2018 was snapped up by Takeda in a $62 billion megamerger.

Advent has invested in numerous life sciences firms including BioDuro, GS Capsule, ICE Group, Suven Pharmaceuticals/Cohance Lifesciences, and Syneos Health. Warburg Pincus, meanwhile, has invested in firms including Polyplus, Norstella, Sotera Health, and Bausch + Lomb.