Q&A: Amid an M&A flurry at Charles River, longtime exec Birgit Girshick discusses how Covid-19 has changed the game
Contract research and manufacturing has been running at a rapid clip amid the pandemic, and big players in the space have looked to leverage runaway cash flow to turbocharge their business. For CRO Charles River Laboratories, that means more of everything — including a big infusion into its manufacturing arm.
In mid-May, the company paid $292.5 million for Vigene Biosciences and its 52,000 square feet of manufacturing space in Rockville, MD. In February, the company bought Cognate and pledged to double capacity in Memphis and Europe. In early April, it teamed up with Valence Discovery to expand its AI platform for molecular property prediction.
Birgit Girshick has been with Charles River for more than 32 years, and is now the EVP of discovery and safety assessment. She joined the company’s Germany office in 1989, where she held a number of roles, including some administrative duties. She answered questions about the company’s growth and the game plan it’s laid out.
Charles River Laboratories has made a flurry of moves in 2021. What are some of the things the company is looking for when scouting possible acquisitions?
Our guiding principle for acquisitions is to acquire companies with the best science and the best people. This is how we enhance the breadth and quality of our services as we grow.
Our M&A strategy is built with the client and patient at the forefront. We regularly confer with our clients to understand what is of the utmost importance to the success of their programs. We also continue to work with them to ensure that an acquisition not only bolsters our comprehensive portfolio, but is high quality and that the technology is relevant.
The cell and gene therapy landscape is changing fast. How does a company navigate a sector that is changing so rapidly?
We are investing organically, through M&A and partnerships, to obtain access to new technologies and expertise to further accelerate pathways to “go” or “no go” decisions for our clients. Just recently, for example, we acquired Retrogenix.
Retrogenix is an early-stage CRO providing specialized bioanalytical services utilizing its proprietary cell microarray technology. This technology is used for target receptor identification, off-target profiling, and target deconvolution on a wide range of novel therapeutics including biologics, cell therapies, and small molecules. It is also a premier platform for off-target screening for preclinical safety assurance in CAR-T therapies, providing our clients another service in their complex C> development efforts.
Our strategy is an integral part of ensuring we are the preferred partner for C> innovators worldwide. For example, we had a longstanding partnership with Distributed Bio, which led to our acquisition of them earlier this year. Distributed Bio is a next-generation antibody discovery company … By combining Distributed Bio’s antibody libraries and immuno-engineering platform with Charles River’s extensive drug discovery and non-clinical development expertise to create an integrated, end-to-end platform for therapeutic antibody and cell and gene therapy discovery and development.
Obviously, cell and gene therapy have been the focus of many of the latest deals Charles River has been a part of. Can you talk about what goes into the conversation, when members of your team sit down and say “we’re going to put money toward this?” What is that conversation like? Is it all at once, or gradual?
Our process is well thought out and extensive — our annual strategic planning process takes a deep dive into all existing and new modalities, technologies, and markets.
Cell and gene therapies now make up around 11% of the pharmaceutical pipeline with about 2/3 of the R&D programs currently in the preclinical phase. In 2020 alone, we have conducted over 900 studies, driving and deepening our expertise in this field. Due to this rapid growth and advancement, we recognized our clients’ need for expertise and capabilities.
As a part of our client journey, we regularly consult with our clients about their needs and technologies that would help them to be successful. We also use partnerships to find and test drive new technologies to ensure we’re always becoming easier to work with and building upon our best-in-class science.
How has the pandemic affected operations?
Charles River has been able to remain fully operational across all sites by adhering to the ongoing safety measures enacted at the start of the pandemic, including, but not limited to: having employees work from home when possible; enhanced cleaning procedures; restrictions on all non-essential business travel; testing, tracking, and contact tracing of COVID-19 cases; modified employee work schedules to create “time and distance” and separation of staff; as well as strict visitor policies. We have also launched remote audits and virtual facility tours, and we are actively utilizing remote study monitoring to support clients who are unable to travel.
Our global and site business continuity plans are active, up to date, and helping our site-based operations, as well as associated logistics and support, to continue to meet our clients’ needs for planned and new projects, including work supporting COVID-19 research efforts.