Charles River Labs plans to buy gene-therapy focused CDMO Vigene Biosciences for $300 million, further expanding its presence in the manufacturing space.

The deal – which values Vigene at $292.5 million – will add viral vector-based gene delivery solutions to the contract research organization’s (CRO) expanding contract manufacturing offering.

The transaction is expected to close in the beginning of the third quarter.

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Charles River CEO James Foster said the purchase would “expand our comprehensive cell and gene therapy portfolio to span each of the major CDMO platforms – cell therapy, viral vector, and plasmid DNA production.”

News of the planned acquisition comes just two months after Charles River bought Cognate BioServices, a contract development and manufacturing organization (CDMO) with autologous and allogeneic cell therapy, plasmid DNA and viral vector manufacturing capabilities.

‘Primarily’

Vigene’s primary area of expertise is the manufacture of viral vectors – including adeno-associated viruses and lentivirus – for use in gene therapies and gene-modified cell therapies.

In addition, the CDMO makes “research grade and cGMP plasmid DNA” for manufacturers of cell therapies, gene therapies, and vaccine production

The Vigene deal also follows just weeks after Charles River’s Q1 earnings call when Foster said the CRO’s manufacturing business would be “primarily cell therapy-related.”

At the time he said the focus on cell therapies reflected the lower level competition in the space relative to the gene therapy sector.

Scaling-up

Evecore ISI analyst Elizabeth Anderson said the deal would be good for Charles River in the medium term, writing in a note to investors that it is in keeping with the firm’s acquisition strategy.

She said the proposed “transaction highlights Charles River’s CDMO strategy of scaling up in higher-value areas that fit in very nicely with the rest of Charles River’s portfolio.

She added that the acquisition “should provide additional reassurance about Charles River’s ability to sustain HSD organic growth over the medium term.”