Thermo Fisher Scientific late Sunday evening agreed to buy Brammer Bio for $1.7 billion, yet another bet by a large biopharmaceutical organization on the future of gene therapy.
Thermo (NYSE: TMO), a Waltham, MA, developer of lab equipment, made an all-cash offer for Cambridge, MA-based Brammer, a contract manufacturer of gene therapy delivery tools known as viral “vectors.”
In a gene therapy procedure, these vectors—engineered viruses—are filled with genetic blueprints and infused into a patient’s body. Those viruses then deliver their instructions, which tell the body to produce a protein that it is lacking due to a particular genetic disease. The hope is gene therapies provide a last-lasting, if not permanent effect through a single infusion. But it’s unclear how long any given treatment will last and, ultimately, what their commercial prospects will be. So far, they’ve struggled commercially.
The deal establishes Thermo’s presence in gene therapy, a field that just saw its first U.S. approval in 2018—for Luxturna, a treatment for inherited vision loss from Spark Therapeutics (NASDAQ: ONCE). Others treatments are in human testing for spinal muscular atrophy, hemophilia, and more. The FDA has even recently announced long-term plans to accommodate the surge in expected approval filings for gene therapies.
The belief that gene therapy is here to stay and will overcome its commercial questions has large pharmaceutical companies opening their wallets. In January, Johnson & Johnson (NYSE: JNJ) agreed to pay $100 million to MeiraGTx (NASDAQ: MGTX) for rights to experimental gene therapies for inherited forms of vision loss. In February, Biogen (NASDAQ: BIIB) inked an $800 million deal to acquire Nightstar Therapeutics, a developer of gene therapies for eye diseases. That same month, Roche paid $4.8 billion for Spark. And just last week, Pfizer (NYSE: PFE) nabbed an option to buy Parisian biotech Vivet Therapeutics, continuing a methodical roll-up of gene therapy assets.
Thermo is betting that the momentum will continue and that more and more companies will need viral vectors for gene therapy clinical trials and, eventually, commercial products. Brammer is expected to generate $250 million in revenue 2019 and has roughly 600 employees in Massachusetts and Florida.
“Gene therapy is an area of increasing focus for our customers and is fast-evolving given its potential to treat a range of genetic disorders,” said Thermo CEO Marc Casper, in a statement.
The deal should close in the second quarter.