Lonza to buy large biologics site from Roche in US for $1.2 billion
Reuters
Published Mar 20, 2024 06:17
Updated Mar 20, 2024 08:27
By Miranda Murray and Ludwig Burger
(Reuters) -Swiss contract drug manufacturer Lonza said on Wednesday it would buy one of the world's largest manufacturing sites for biologic drugs in California from drugmaker Roche (LON:0QQ6) for $1.2 billion.
Lonza plans to spend another 500 million Swiss francs ($562.3 million) to upgrade the facility in Vacaville, which makes monoclonal antibodies from genetically modified living cells, to produce a new generation of drugs, the company said in a statement.
Roche unveiled plans to sell the site in May last year, saying it no longer needs the very large antibody volumes the plant provides, as it plans to focus on drugs targeting smaller patient populations and a range of biotechnology methods beyond monoclonal antibodies.
The Vacaville facility currently has a total bioreactor capacity of around 330,000 liters, making it one of the largest biologics manufacturing sites worldwide by volume, Lonza said.
"The Vacaville site is a highly valuable strategic acquisition that will make capacity immediately available for our customers and unlock future growth for our Biologics division," Jean-Christophe Hyvert, president of Biologics at Lonza, said in the statement.
Lonza shares jumped 4.3% at the 0800 GMT open.
The transaction is expected to close in the second half of 2024, subject to customary closing conditions.
Basel-based Lonza also raised its 2024-2028 sales growth target to a range of 12%-15% per year, from its 11-13% growth estimate previously.
The mid-term profit margin guidance remains unchanged, it added.
Lonza shares were battered last year amid uncertainty over its longer-term orders from drugmakers, but the stock bounced back in January when the company confirmed its outlook and Chairman Albert Baehny announced he would step down in May.
Under the deal, the about 750 employees of Roche subsidiary Genentech at the facility will be offered employment by Lonza and the products currently produced at the site will continue to be supplied by Lonza for a transition period, Roche said.
Get The App
Written By: Reuters
Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.