Drug discovery increasingly requires sophisticated analysis of proteins, and Thermo Fisher Scientific is building up its capabilities to support such research with the $3.1 billion acquisition of Olink, a company whose technologies and services are used in laboratories around the world.
According to deal terms announced Tuesday, Thermo Fisher, based in Waltham, Massachusetts, will pay $26 cash for each American depositary share of Olink. That price represents a premium of about 74% to the Uppsala, Sweden-based company’s closing stock price on Monday. When Olink made its Nasdaq debut in 2021, it priced shares at $20 apiece.
Olink is a player in the field of proteomics, the analysis of proteins. But the company does not discover or develop new drugs. Rather, it provides tools and services for the scientists who do that research at biopharmaceutical companies and universities. The company sells kits that drug researchers can use to analyze proteins in their own labs. Samples can also be sent for analysis at an Olink lab.
In the first half of 2023, Olink reported $56.9 million in revenue, a 13.3% increase compared to the same period last year. By geography, the Americas represent Olink’s largest market, followed by the EMEA region: Europe, Middle East, and Africa. In the first half of this year, Olink reported a net loss of $22.2 million. Thermo Fisher projects Olink will generate more than $200 million in revenue in 2024.
“The acquisition of Olink underscores the profound impact that proteomics is having as our customers continue to advance life science research and precision medicine,” Thermo Fisher Chairman, President & CEO Marc Casper said in a prepared statement. “Olink’s proven and transformative innovation is highly complementary to our leading mass spectrometry and life sciences platforms.”
When the acquisition closes, Olink will become part of Thermo Fisher’s Life Sciences Solutions, a business segment that encompasses reagents, instruments, and consumables used in biomedical research, drug and vaccine discovery, and disease diagnosis. Life Sciences Solutions is the second largest of Thermo Fisher’s four business segments, posting $13.5 billion in revenue in 2022, a 13.4% decrease compared to the prior year. In its annual report, the company said the revenue decline was due to lower sales in the genetic sciences business as Covid-19 testing demand slowed down.
Thermo Fisher has been an active acquirer. Nearly a year ago, the company announced a $2.6 deal to acquire diagnostics products company The Binding Site. Earlier this year, Thermo Fisher struck a $912 million deal to buy CorEvitas, a company that collects real-world evidence about the safety and efficacy of therapies.
Thermo Fisher’s Olink acquisition has been approved by the boards of directors of both companies. Thermo Fisher said it will fund the deal with a combination of cash on hand and debt financing. The transaction is expected to close by the middle of next year.
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