Waters hopes for bioanalytic windfall after $1.36bn deal bring light scattering

The impending acquisition of light scattering technology and software firm Wyatt will help Waters play in the $1.8 billion bioanalytical characterization market for new modalities, the firms says.

In February, life sciences firm Waters Corporation announced its intentions to buy Wyatt Technology for $1.36 billion.

When the deal closes – expected before the end of June – Waters will add the Santa Barbara, California-based family firm with a workforce of more than 200 employees and a range of bioanalytical technologies.

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Wyatt’s portfolio includes a range of on-line multi-angle laser light scattering instruments, macromolecular characterization software, and field-flow fractionation for separating nanoparticles in solution. These are used in product development, manufacturing, and QA/QC settings to determine the critical quality attributes of therapeutics including cell and gene therapies, vaccines, and proteins.

“With more than 80% of its revenues tied to large molecule applications, Wyatt expands Waters’ portfolio and increases our exposure to faster growth areas within biologics,” Waters CEO Udit Batra told stakeholders on is firm’s first quarter conference call this week.

“It also increases our ability to build a business in bioanalytical characterization, which is a $1.8 billion total addressable market with a 10% to 12% projected annual growth rate. We remain on track to close in the second quarter of this year. We also expect the transition to deliver immediate growth and adjusted operating margin accretion.”

He added once closed the business will add “roughly 25% of our incremental revenue for Waters for the rest of the year. So we expect this to continue to remain extremely strong for the balance of the year.”

For the first quarter 2023, Waters reported a 7% drop in sales into the pharmaceutical market to $385 million. Much of this was attributed to pre-commercial biotech companies. Such firms “got extremely cautious and virtually halted their instrument purchases, especially later in March,” said Batra.

“We’re starting to see some relaxation but we’ve assumed that this situation will persist for the balance of the year. And over the, I don’t need to remind you, the biotech industry plays an extremely important role in the innovation that we see across health care, and they remain our very, very strong customers.”