It’s the circle of life for life-sciences companies.
The California-based Bio-Rad Laboratories and the Netherlands-based Qiagen are deep in talks over a tie-up potentially worth more than $10 billion, according to a Wall Street Journal report on Monday. While a merger may not be finalized for at least a few weeks, sources tell WSJ, the trans-Atlantic partnership would mark yet another major deal in just about the only sector where M&A hasn’t completely fizzled out this year.
Rules for Bio-Radicals
Like the tech sector overall, biotech — for obvious reasons — experienced a major boom during the pandemic. But unlike their computer-coding counterparts, biotech firms have not seen major devaluations through 2022 so far. And while wild inflation and the corresponding rise in interest rates have largely slowed dealmaking across the economy (overall deal volume is down 12% this year, according to a recent McKinsey report), biotech firms, with trillions in newfound wealth in their war chests, are still finding plenty of lucrative reasons to link up.
For Bio-Rad and Qiagen, a marriage would create a powerful player in the medical-diagnostic market — and place it in league with the sector’s other M&A deals this year:
- Bio-Rad, which has a market valuation of around $13 billion, develops life-science research and clinical diagnostics products for hospitals, commercial laboratories, and research institutions; meanwhile, Qiagen provides over 500,000 customers with tech that provides molecular diagnostics of DNA, RNA, blood proteins, and other materials.
- Last month, drugstore giant CVS acquired home-health company Signify for $8 billion, just after Walgreens acquired CareCentrix. Pfizer, meanwhile, has splurged after winning the vaccine race, dropping over $5.4 billion for the sickle cell-focused Global Blood Therapeutics and over $11 billion to acquire Biohaven Pharmaceuticals in the last month.
Cold Feet: In late 2020, Qiagen was nearly acquired by Thermo Fisher for $10 billion, before shareholders with cold feet rejected the deal saying it undervalued the company. Just a few months later, in Spring 2021, Thermo Fisher landed on a new target: pharmaceutical testing company PPD, which it paid $17 billion for. You know what they say – cell high!