Agilent to acquire drug services firm BioVectra for nearly $1 billion

Agilent Technologies, a company best known for selling scientific instruments, is making a big splash in the drug services market.

The California-based firm has announced it will acquire the Canadian contract development and manufacturing organization (CDMO) BioVectra for $925 million. The investment will solidify Agilent’s position in making oligonucleotides, synthetic strands of DNA or RNA used in gene editing and in therapies that work by silencing or promoting the degradation of target RNA.

Agilent already manufactures oligonucleotides to make guide RNAs (gRNAs) for six pharmaceutical companies, including Alnylam Pharmaceuticals and Novartis. These gRNAs, however, are just one part of the complex machinery used in CRISPR-Cas9-based gene editing, says Brian Carothers, a vice president at Agilent. “With the BioVectra acquisition, we aim to be a one-stop shop for our clients who need the technology for gene editing.”

Oligonucleotide demand has increased over the past 5 years as more pharmaceutical companies develop RNA-based drugs, Carothers says. “The molecules have shown promising results in stopping the progression of diseases,” he adds. Agilent entered the oligo business in 2006 and has kept up with rising demand through acquisition and by expanding production. With the purchase of BioVectra, Agilent aims to enhance its oligo capabilities further, Carothers says.

BioVectra will also help diversify Agilent into other areas. The Canadian company synthesizes peptides such as glucagon-like peptide-1 amide (GLP-1) agonists, produce highly potent molecules for cancer drugs, and creates the drug delivery vehicles called lipid nanoparticles.

Headquartered in Charlottetown, Prince Edward Island, BioVectra started in 1970 as a clinical reagent manufacturer. The company has been bought and sold several times and in 2019 was acquired by the investment firm H.I.G. Capital for $250 million. Its sales last year were $113 million.

James Bruno, president of the consulting firm Chemical and Pharmaceutical Solutions, says the purchase by Agilent initially came as a surprise to him. “At first glance, I thought, ‘What was Agilent thinking?’ I have always considered Agilent an analytical equipment supplier,” Bruno says. However, the news made more sense when he remembered Agilent’s oligo and peptide capabilities. “This will significantly increase Agilent’s capability to do more in that area,” he says

In 2017, the scientific instrument giant Thermo Fisher Scientific made a similar foray into the CDMO business through the $7.2 billion acquisition of Patheon. But Bruno sees differences between the two deals. “Thermo Fisher decided they wanted to own all kinds of pharma services, but Agilent’s acquisition of BioVectra is a strategic addition to its existing capabilities,” he says.