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Charles River (CRL) Advances in Gene Therapy With Vigene Buyout
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Charles River Laboratories International (CRL - Free Report) , in its efforts to enhance capabilities in the high-growth cell and gene market, recently acquired Vigene Biosciences, Inc., a U.S.-based contract development and manufacturing organization (CDMO) in this niche. The total consideration of this acquisition deal includes initial purchase price of $292.5 million in cash (subject to customary closing conditions) and an additional payment of up to $57.5 million, depending on future performance.
More on Vigene Biosciences
This Rockville, MD-based gene-therapy CDMO provides viral vector-based gene delivery solutions. The company specializes in CGMP viral vector manufacturing, used for gene therapies and gene-modified cell therapies. It also offers high-quality, research grade and CGMP plasmid DNA.
With the completion of the acquisition, Vigene gets integrated into Charles River’s Manufacturing Solutions segment. This segment has been renamed from Manufacturing Support to reflect broader scientific capabilities with the addition of the cell and gene therapy CDMO business.
Strategic Significance of the Deal
Vigene Biosciences’ extensive gene therapy capabilities areexpected to complement Charles River’s existing cell and gene therapy contract manufacturing capabilities, primarily Viral Vectors and Plasmid DNA. The consolidation will establish an end-to-end, gene-modified cell therapy solution in the United States. It will also allow the client to seamlessly conduct analytical testing, process development, and manufacturing for advanced modalities with the same scientific partner. This will drive greater efficiency and accelerate speed to market.
Image Source: Zacks Investment Research
Per company data, the addressable market for cell and gene therapy CDMO services, principally for cell therapy, plasmid DNA, and viral vector production, is currently estimated at approximately $2.5 billion globally and is expected to grow at least 25% annually over the next five years. The latest development will increase Charles River’s growth potential on bigger exposure in this high-growth market.
Financial Significance
The acquisition is expected to remain accretive to Charles River’s long-term revenue and earnings growth. Vigene is expected to generate annual revenuesof $30 to $35 million in 2021 and is expected to grow at least 25% annually over the next five years.
Share Price Performance
The stock has outperformed its industry over the past year. It has risen 111.7% compared with the industry’s 15.1% growth.
Other Strategic Buyouts
Charles River broadens the scope of the products and services across the drug discovery and early-stage development continuum through focused acquisitions. Citoxlab (acquired in 2019) and HemaCare (acquired in 2020) are an integral part of the company’s growth strategy of successfully expanding the company’s portfolio and broadening its geographic footprint. According to Charles River, the acquisition of Citoxlab enhanced its position as a leading global early stage CRO. The acquisition of HemaCare enhances its ability to provide a comprehensive cell therapy solution from discovery through commercialization. The acquisition of Cognate in March 2021 too is expected to be highly complementary to the company’s Biologics business. The acquisition establishes Charles River as a premier scientific partner to cell and gene therapy development, testing and manufacturing.
Zacks Rank and Other Key Picks
Currently, Charles River carries a Zacks Rank #2 (Buy).
A few other top-ranked stocks from the Medical-Products industry include PetIQ, Inc. (PETQ - Free Report) , National Vision Holdings, Inc. (EYE - Free Report) and Envista Holdings Corporation (NVST - Free Report) .
National Vision Holdings, which carries a Zacks Rank #1, has a long-term earnings growth rate of 23%.
Envista Holdings, which carries a Zacks Rank #2 (Buy), has a long-term earnings growth rate of 26.4%.
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Image: Bigstock
Charles River (CRL) Advances in Gene Therapy With Vigene Buyout
Charles River Laboratories International (CRL - Free Report) , in its efforts to enhance capabilities in the high-growth cell and gene market, recently acquired Vigene Biosciences, Inc., a U.S.-based contract development and manufacturing organization (CDMO) in this niche. The total consideration of this acquisition deal includes initial purchase price of $292.5 million in cash (subject to customary closing conditions) and an additional payment of up to $57.5 million, depending on future performance.
More on Vigene Biosciences
This Rockville, MD-based gene-therapy CDMO provides viral vector-based gene delivery solutions. The company specializes in CGMP viral vector manufacturing, used for gene therapies and gene-modified cell therapies. It also offers high-quality, research grade and CGMP plasmid DNA.
With the completion of the acquisition, Vigene gets integrated into Charles River’s Manufacturing Solutions segment. This segment has been renamed from Manufacturing Support to reflect broader scientific capabilities with the addition of the cell and gene therapy CDMO business.
Strategic Significance of the Deal
Vigene Biosciences’ extensive gene therapy capabilities areexpected to complement Charles River’s existing cell and gene therapy contract manufacturing capabilities, primarily Viral Vectors and Plasmid DNA. The consolidation will establish an end-to-end, gene-modified cell therapy solution in the United States. It will also allow the client to seamlessly conduct analytical testing, process development, and manufacturing for advanced modalities with the same scientific partner. This will drive greater efficiency and accelerate speed to market.
Image Source: Zacks Investment Research
Per company data, the addressable market for cell and gene therapy CDMO services, principally for cell therapy, plasmid DNA, and viral vector production, is currently estimated at approximately $2.5 billion globally and is expected to grow at least 25% annually over the next five years. The latest development will increase Charles River’s growth potential on bigger exposure in this high-growth market.
Financial Significance
The acquisition is expected to remain accretive to Charles River’s long-term revenue and earnings growth. Vigene is expected to generate annual revenuesof $30 to $35 million in 2021 and is expected to grow at least 25% annually over the next five years.
Share Price Performance
The stock has outperformed its industry over the past year. It has risen 111.7% compared with the industry’s 15.1% growth.
Other Strategic Buyouts
Charles River broadens the scope of the products and services across the drug discovery and early-stage development continuum through focused acquisitions. Citoxlab (acquired in 2019) and HemaCare (acquired in 2020) are an integral part of the company’s growth strategy of successfully expanding the company’s portfolio and broadening its geographic footprint. According to Charles River, the acquisition of Citoxlab enhanced its position as a leading global early stage CRO. The acquisition of HemaCare enhances its ability to provide a comprehensive cell therapy solution from discovery through commercialization. The acquisition of Cognate in March 2021 too is expected to be highly complementary to the company’s Biologics business. The acquisition establishes Charles River as a premier scientific partner to cell and gene therapy development, testing and manufacturing.
Zacks Rank and Other Key Picks
Currently, Charles River carries a Zacks Rank #2 (Buy).
A few other top-ranked stocks from the Medical-Products industry include PetIQ, Inc. (PETQ - Free Report) , National Vision Holdings, Inc. (EYE - Free Report) and Envista Holdings Corporation (NVST - Free Report) .
PetIQ, currently sporting a Zacks Rank #1 (Strong Buy), has a long-term earnings growth rate of 25%. You can see the complete list of today’s Zacks #1 Rank stocks here.
National Vision Holdings, which carries a Zacks Rank #1, has a long-term earnings growth rate of 23%.
Envista Holdings, which carries a Zacks Rank #2 (Buy), has a long-term earnings growth rate of 26.4%.
Bitcoin, Like the Internet Itself, Could Change Everything
Blockchain and cryptocurrency has sparked one of the most exciting discussion topics of a generation. Some call it the “Internet of Money” and predict it could change the way money works forever. If true, it could do to banks what Netflix did to Blockbuster and Amazon did to Sears. Experts agree we’re still in the early stages of this technology, and as it grows, it will create several investing opportunities.
Zacks’ has just revealed 3 companies that can help investors capitalize on the explosive profit potential of Bitcoin and the other cryptocurrencies with significantly less volatility than buying them directly.
See 3 crypto-related stocks now >>