$7.2bn deal expands Thermo Fisher’s laboratory products and services segment

Laboratory supplies behemoth Thermo Fisher Scientific has agreed to buy contract development and manufacturing organisation Patheon for $7.2 billion (£5.6 billion), including assuming around $2 billion of Patheon’s debt.

As the laboratory supply sector continues to consolidate, the larger providers are seeking to provide more comprehensive services. This deal gives Thermo Fisher a ready-made platform in the rapidly-growing area of contract development and manufacturing, to go alongside its existing laboratory products and services business. Thermo expects to be able to save $90 million in costs after three years.

Patheon has expertise in developing and manufacturing both small molecules and biomolecules. Its private equity owners have built up the company by merging with DSM’s pharmaceuticals division, as well as taking in formulation specialists Banner Pharmacaps and Agere, and active pharmaceutical ingredient maker Irix.