Cytiva Picks Up Where GE Leaves Off after $21B Deal

The former BioPharma business of GE has a new identity to go with its new owner, as Danaher has launched the renamed business after completing its $21.4 billion purchase of the former GE Healthcare Life Sciences.

Cytiva, as the $3.3 billion-a-year business is now known, says it will retain the branded businesses that specialize in technologies and services that help advance and accelerate the development and manufacture of therapeutics.

The businesses specialize in areas that include cell biology and protein research equipment for producing monoclonal antibodies and other biologics; process chromatography hardware and consumables; cell culture media; single-use technologies; development instrumentation; diagnostic tests; lateral flow assays; and consumables, and service.

But Cytiva says it will also look to expand on its success through expanded activity in cell and gene therapies—and additional work with customers working toward COVID-19 drugs, vaccines, and tests.

Cytiva will pick up where GE left off in a collaboration it announced March 3 with Sona Nanotech, a Halifax, NS, nanotech life-sci company focused on diagnostics. Sona and GE Healthcare agreed to jointly complete test development of the Sona COVID-19 Coronavirus rapid response lateral flow test, and use what is now Cytiva’s Fast Flow High Performance (FFHP) Membrane in production of the test.

“There’s a big focus from all of our customers either to accelerate work that they’re working on already, or to do new work,” Conor McKechnie, Cytiva’s chief marketing officer, told GEN. “We’re seeing a lot of questions form customers on how we can bring our expertise to bear to support them in the project that they’re working on.”

Unusual request

In addition to remote working for most employees, COVID-19 has also impacted the company by bringing to it an unusual request: Swedish authorities, McKechnie said, contacted the company requesting that it design and deliver 3D-printed face shields: “We had never done anything like that before. We do have a 3D printing capability at our site in Uppsala, Sweden. So we turned this around fairly quickly, and started manufacturing those.”

Cytiva emerged today following GE’s announcement yesterday that it had completed the sale of its biopharma business within unit to Danaher for $21.4 billion—of which approximately $20 billion was cash—plus Danaher agreeing to assume pension liabilities. Net proceeds to GE totaled approximately $20 billion, after taking into account deal taxes, deal fees and factored receivable balances.

Cytiva begins life with about 6,800 employees, operations in 40 countries, and a pair of challenges: Growing its own brand and the businesses behind it, namely the branded businesses previously part of GE.

They include ÄKTA, a developer of chromatography systems; Amersham™, a maker of imaging systems; HyClone, which markets cell culture and fermentation process products; MabSelect, developer of a BioProcess protein A resin for capturing monoclonal antibodies (mAbs) from large sample volumes; and Whatman, a seller of lab supplies and consumables such as filters, devices, and membranes.

“We really operate across the while continuum of research, process development, and bioprocessing—everything that it takes to discover and develop a new therapeutic, and then go through the process of how it’s made, then onto the offerings required for the manufacturing and the services required to support manufacturing,” McKechnie said. “The way to think about this organization currently is as a provider of tools and technologies, predominantly, and services in some instances.”

More than 75% of the biologic drugs approved by the FDA last year used manufacturing technologies of various Cytiva businesses, according to the company.

“We continue to be the company that we are,” McKechnie said, “a company which has a strong heritage of industry shaping brands and technologies in many ways that go back years and years and years. That heritages really propels us forward.”

“Key strategic area”

McKechnie said cell and gene therapy was “a key strategic area” for Cytiva, as it builds on heritage biopharma processing businesses, predominantly in monoclonal antibodies, insulin, and vaccines.

“The question is, what’s next? What’s the next therapeutic modality that’s really going to transform healthcare and medicine, and provide for the business? Cell and gene therapy are absolutely key for us, so we see it as a significant growth area,” McKechnie said.

To achieve growth in cell and gene therapy, he added, Cytiva will step up its pursuit of collaborations with research and industry partners. The business inherits GE Healthcare Life Sciences’ role as a partner with board seats on the $50 million center for advanced biological innovation and manufacturing launched last year by companies and institutions that also included Harvard University, Massachusetts Institute of Technology, Fujifilm Diosynth Biotechnologies, and Alexandria Real Estate Equities.

Other members of the center included Beth Israel Deaconess Medical Center, Boston Children’s Hospital, Brigham and Women’s Hospital, the Dana-Farber Cancer Institute, Massachusetts General Hospital, MilliporeSigma, and the Commonwealth of Massachusetts.

“That’s going to have a significant focus on cell and gene therapy,” McKechnie said. “We know that an industry has to come together to solve some of these challenges, because it’s a lot more complex than an already complex mAb industry.”

Headquartered in Washington, DC, Danaher has more than 60,000 staffers or “associates” in more than 20 operating companies. Since the mid-1980s, Danaher has carried out an ongoing company-wide improvement effort based on lean manufacturing and anchored on a common culture and operating system, called the Danaher Business System, focused on people, plans, processes, and performance.

Life sciences is one of three core divisions of Danaher; the other two are environmental and applied solutions, and diagnostics. Danaher has grown its life-sci business in recent years through a series of acquisitions. In 2015, Danaher shelled out $13.8 billion to acquire Pall, a global leader in high-tech filtration, separation, and purification. A year later, Danaher expanded its molecular diagnostics business by snapping up Cepheid for approximately $4 billion, including debt.

Shedding debt

In February 2019, Danaher agreed to acquire GE Biopharma for $21.4 billion. GE Chairman CEO H. Lawrence (Larry) Culp Jr.—who was Danaher’s CEO from 2001 to 2014—told The Wall Street Journal at the time that by shedding one of its fastest-growing businesses, GE intended to reduce debt quicker than earlier plans to spin off all of GE’s healthcare operations through an initial public offering.

GE Healthcare retains businesses focused on pharma, diagnostics, contrast agent manufacturing, and imaging pharmaceuticals businesses

Cytiva will operate intact as a standalone company within Danaher’s Life Sciences segment. The segment—which grew last year to nearly $7 billion in sales—includes Danaher’s Pall, Beckman Coulter Life Sciences, SCIEX, Leica Microsystems, Molecular Devices, Phenomenex, and IDT businesses.

Life Sciences finished last year with an operating profit of $1.401 billion, up 14% from $1.229 billion in 2018, on sales that rose 7.4%, to $6.951 billion from $6.471 billion.

Across all its business segments, Danaher saw its operating profit climb 7%, to $3.269 billion from $3.055 billion, on sales that rose 5% year-over-year, to $17.911 billion from $17.049 billion.

“We’ve got this terrific opportunity joining the Danaher family, with a company that really has a strong focus in the life sciences, and is going to continue to support the growth of this business, the work that we do in innovation with our customers, and continue to support our success,” McKechnie said. “It feels like a very natural transition. It feels like a very thoughtful place for this business to take its next steps in its contribution to the industry. We’re really, really excited about it.”