Charles River to Take Over Sino-U.S. CRO WuXi in Deal Worth $1.6B
Combined entity will offer service portfolio spanning molecule creation to human testing.!--h2>
Charles River Laboratories is to acquire CRO WuXi PharmaTech in a cash and shares-based deal worth some $1.6 billion. WuXi offers a portfolio of laboratory and manufacturing services from drug discovery through to commercialization. The firm is based in Shanghai and has operations in multiple locations in China and the U.S.
Charles River, a global provider of research models and preclinical, clinical, and support services, claims that the acquisition of WuXi represents a transformational transaction for the drug development services industry. “This transaction revolutionizes the contract research landscape by creating the only global CRO to offer fully integrated research and drug development services from molecule creation to first-in-human testing,” states James C. Foster, chairman, president, and CEO at Charles River.
“For the first time, our existing and potential clients will be able to obtain support for their early-stage drug discovery development needs from one company with unparalleled scientific depth and breadth in chemistry and biology,” Foster notes.
WuXi recorded total net revenues of $270 million in calendar year 2009, up 7% on 2008 figures. Charles River’s net sales exceeded $1.2 billion in 2009, down 10.5% on the previous year. The company says that it expects to achieve post-acquisition pretax cost savings and synergies of about $20 million on an annualized basis, starting in 2011. Savings will be achieved primarily through consolidation of corporate infrastructure as well as from operating efficiencies.