Transition: BioReliance Settles In With Sigma-Aldrich’s SAFC Division

BioReliance, a Rockville, Md.-based provider of biologic safety and specialized toxicology testing services, may finally have settled down after bouncing among three owners since 2004. During C&EN’s recent visit to the company, it appeared that BioReliance managers are happy with their firm’s newest owner, SAFC, the contract manufacturing and fine chemicals business of Sigma-Aldrich.

Executives from both SAFC and BioReliance say the integration has been remarkably smooth. In early 2012, Sigma-Aldrich paid $350 million for BioReliance, which has annual sales of about $120 million. To make sure there was a good fit, the executives said, they talked frankly about ownership and management concerns early in negotiations.

Since early 2007, BioReliance was owned by the private equity firm Avista Capital Partners. Chief Executive Officer Charles C. Harwood Jr., an experienced health care executive and an Avista adviser, led the business. Last month, SAFC Vice President Archie Cullen became the new president of BioReliance after Harwood’s retirement.

In a conference call last month with stock analysts, SAFC President Gilles A. Cottier recognized Harwood for his leadership and help during the transition. “The broad management team of BioReliance is remaining in place,” Cottier emphasized.

BioReliance had done well under Avista’s ownership, posting double-digit sales growth in 2011, the year before Sigma-Aldrich acquired it. But an earlier period under Invitrogen, before that company merged in 2008 with Applied Biosystems to become Life Technologies, wasn’t so successful.

In April 2004, Invitrogen paid $500 million to acquire the then-57-year-old BioReliance. By most accounts, the relationship didn’t go well, and Invitrogen sold the firm in February 2007 for just $210 million to Avista.

Under Invitrogen, BioReliance had been a “lumpy and unpredictable business,” according to Mizuho Securities USA stock analyst Peter Lawson. But in an early-2012 report to clients, Lawson was positive about BioReliance, suggesting that being part of Sigma-Aldrich would mute any volatility at the firm. The testing business, he noted, complements SAFC’s sales to biopharmaceutical customers and “improves its ability to capture growth from biological drugs production.”

In acquiring BioReliance, SAFC got a company with a long history marked by several biotechnology firsts. It was founded in 1947 as Microbiological Associates (MA) to provide cell culture media for the first immortal cell line and the emerging tissue culture field, recounted Michael Garrett, BioReliance’s senior director for global marketing.

By 1951, the company was the first commercial supplier of cell cultures and reagents. In 1955, MA set up the first polio vaccine biosafety protocols under a government contract. It also supported the National Aeronautics & Space Administration with safety testing for samples brought back from the moon in 1969.

As the biotechnology industry emerged in the 1980s, the company created the biosafety testing program for the first approved therapeutic produced in mammalian cells, Genentech’s blood clot buster Activase. It later developed testing for the first monoclonal antibody drug, Ortho Pharmaceutical’s transplant antirejection agent Orthoclone OKT3.

In 1988, MA tested the first genetically engineered microbial pesticide to be approved by the Environmental Protection Agency for field trials. In the 1990s it became involved in the emerging areas of transgenic animals, xenotransplantation, gene therapy, stem cells, and testing for mad cow and other diseases.

MA entered the market for analytical testing and characterization of pharmaceuticals, with a focus on macromolecules, in 1995. In 1997, the company took the BioReliance name and became publicly traded. Today it offers more than 1,000 standard tests as well as customized services, Garrett said.