Two CDMOs come together as they look to expand their reach in cell therapy manufacturing
As the cell therapy field has matured, the manufacturing of such therapies becomes a greater focus for companies small and large. Amid this growth, two CDMOs have come together in a merger to expand their reach.
Lykan Bioscience, based in Massachusetts, and RoslinCT, based in Edinburgh, UK, will become a single advanced therapies CDMO. The newly combined group will offer process development expertise as well as cGMP manufacturing for a broad range of autologous and allogeneic cell therapies, along with gene editing and induced pluripotent stem cell (iPSC) capabilities for cell therapy development. Financial terms of the deal were not disclosed.
As to why the two companies are combining, Lykan CEO Patrick Lucy said in an interview with Endpoints News that the deal came about as the company saw an opportunity early in the year to diversify the investor base, and after some deliberation, RoslinCT rose to the top the list.
According to Roslin’s CEO Peter Coleman, the company has grown rapidly. After netting an investment from GHO Capital Partners earlier this year, Roslin had global ambitions and Lykan arose in conversation as a potential merger partner.
But there are other factors as to why the deal works well for the companies. Both Lykan and Roslin have a deep knowledge in the fields of cell therapy, and with each company positioned on different sides of the Atlantic, they now have a presence in each other’s respective markets.
The deal aims to shorten the development and manufacturing timelines for cell therapy sponsors and the commercial product release in both the US and the UK.
However, there are elements that both companies bring to the table that interest the other.
“When I think about Roslin, and their heritage from Roslin Institute, what they bring is deep science, and in particular with regard to stem cell technology, and more specifically around iPSC technology, gene editing, in addition to existing clients,” Lucy said. “So, we are particularly excited about the iPSC and gene editing platform that is presented by Roslin and believe that could be a significant differentiator for the business going forward in combination with the manufacturing knowledge possessed by both companies.”
For Coleman, the intro into the US market as well as Lykan’s technical capabilities were pieces that brought the deal together.
Discussions for the deal started in Q1 and took around six months to complete. Both CDMOs will retain their brand identities and their marketplaces. All employees will also remain with their respective companies, which brings a total headcount to around 300 people.
The deal also sees the two companies having access to sizeable locations in Edinburgh, Scotland, and Hopkinton, MA. Lykan commissioned a 64,000 square-foot cell therapy manufacturing facility last year and is hoping to have 16 cGMP processing suites running by the end of the year. More laboratory and cGMP capacity expansion in Scotland is planned for RoslinCT’s existing facilities, which include a 40,000 square-foot facility with eight cGMP suites.
Lucy said Lykan has completed the negotiations with the town of Hopkinton and the state of Massachusetts on a tax increment and financing agreements. According to Coleman, he is also looking to triple Roslin’s space by 2023 or 2024 and have a total of 16 suites.
Coleman notes that the merger is hard to compare with other deals like this in the market with both companies getting access to a US and UK facility presence, a late-stage commercial product, gene editing capabilities and a new facility.
“The important thing is that you can add investments and changes in terms of the organizational structure, but I just know the combination will continue to run in the vein that’s required as a CDMO, which is that flexibility and responsiveness that you need to operate in this environment that makes customers satisfied with what you’re delivering for them. And I just feel already straight away … that’s the same in both organizations,” Coleman said.