Thermo Fisher bets big on blood cancer, immune diagnostics with $2.6B Binding Site buyout


Thermo Fisher Scientific is writing another big check to expand its business, this time acquiring diagnostics products company The Binding Site Group in a multi-billion dollar deal that brings a player with a portfolio focused on blood cancers and immune system disorders.

The cash transaction announced Monday is valued at £2.25 billion, or about $2.6 billion. It comes nearly a year after Waltham, Massachusetts-based Thermo Fisher completed its $17.4 billion acquisition PPD, adding the contract research organization to its Laboratory Products and Services business segment. The Binding Site, based in Birmingham, England, will join Thermo Fisher’s Specialty Diagnostics business.

The Binding Site traces its roots to the the University of Birmingham’s medical school, where researchers in the 1970s were looking for innovative ways to make tests that detect specific proteins, according to a company fact sheet. In 1986, they founded The Binding Site. The company’s offerings include Freelite, a test used for diagnosing and monitoring multiple myeloma, a blood cancer affecting the plasma cells in bone marrow. Rounds of multiple myeloma treatment leave drug-resistant myeloma cells that survive and go on to multiply. This type of cancer requires constant monitoring to assess how patients respond to treatment and to determine when they relapse and require a new treatment.

In the announcement of the deal, Thermo Fisher said it is acquiring The Binding Site as patient care shifts toward early diagnosis and monitoring that happens through regular testing. The Binding Site’s particular expertise in multiple myeloma is notable as a new class of medicines establishes itself in the market for this type of blood cancer. These new drugs target the cancer protein B-cell maturation antigen, or BCMA. The first BCMA-targeting drug to reach the market was GSK’s Blenrep, which secured its FDA approval in 2019. The following year, the Binding Site began working with West Hollywood, California-based ONCOTracker in a partnership focused on developing a test that measures BCMA levels in the blood. The companies said this test could be used for monitoring and predicting outcomes in multiple myeloma as well as other types of blood cancers.

Since Blenrep’s approval, more BCMA-targeting drugs have secured regulatory nods. Last week, the FDA approved Johnson & Johnson’s bispecific antibody drug Tecvayli, bringing that company its fourth multiple myeloma drug and its second one that targets BCMA. In March the FDA approved Carvykti, a CAR T-therapy developed by J&J subsidiary Janssen Biotech and partner Legend Biotech. Last year, partners Bristol Myers Squibb and 2SeventyBio won FDA approval for their BCMA-targeting cell therapy, Abecma.

“The Binding Site is extremely well-respected by researchers and clinicians alike for its pioneering diagnosis and monitoring solutions for multiple myeloma,” Marc Casper, chairman, president and CEO of Thermo Fisher said in a prepared statement. “We also know early diagnosis and well-informed treatment decisions for multiple myeloma can make a significant difference in patient outcomes.”

Thermo Fisher’s Specialty Diagnostics segment spans a wide range of offerings that includes Covid-19 testing and cancer diagnostics. In the first nine months of this year, the segment accounted for more then $3.6 billion in revenue, a 13% decline from the same period in 2021. Like many companies that provide diagnostics products, Thermo Fisher has reported declining demand for Covid-19 testing this year.

Nordic Capital acquired The Binding Site in 2011 for an undisclosed price. In the private equity firm’s hands, the company has grown to serve 3,000 customers in more than 100 countries. Thermo Fisher says The Binding Site’s business has been growing about 10% a year and is projected to top $220 million in revenue in 2022.

Thermo Fisher separately announced Monday its plans to buy back $1 billion worth of shares, which will bring the total spent on stock buybacks to $3 billion in 2022. Along with The Binding Site acquisition, Thermo Fisher said the total amount it has committed to capital deployment will reach $6.1 billion this year.

The Binding Site deal is still subject to regulatory approvals. Thermo Fisher expects to complete the transaction in the first half of 2023.

Photo: Michael Fein/Bloomberg, via Getty Images



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