Charles River Laboratories Acquires Oncotest GmbH

Charles River Laboratories announced on Nov. 18, 2015 the acquisition of Oncotest GmbH, a Freiberg, Germany-based contract research organization (CRO) providing discovery services for oncology.

Oncotest specializes in in-vivo pharmacology services. The company has collected more than 400 patient-derived xenograft (PDX) tumor models, which allow scientists to examine how individual tumors will react to certain compounds. Oncotest also offers a full range of in-vitro assays using both commercially available and proprietary PDX-derived cell lines.

"Global biopharmaceutical clients are increasingly demanding a full suite of oncology capabilities from a single partner, including PDX tumor models, cell lines, imaging services, and immuno-oncology tools," noted James C. Foster, chairman, president, and CEO of Charles River, in a press release. "With Oncotest GmbH, Charles River Discovery Services now has one of the most comprehensive and translational portfolios of oncology discovery services in the early-stage CRO industry."

Charles River Laboratories purchased Oncotest for approximately €34 million (approximately US$36 million). The transaction includes a potential additional payment of €2 million (approximately $2 million) based on future performance.

The company says the acquisition will have negligible impact on their consolidated revenue and non-GAAP earnings in the fourth quarter of 2015. Oncotest is expected to represent around 1% of Charles River’s consolidated revenue.

Oncotest will join Charles River’s group of In Vivo Discovery businesses, which offer research and proof-of-principle pharmacology studies in relevant animal models of human diseases.

Charles River is no stranger to acquisitions. In July 2015, Charles River acquired Celsis International Ltd., a Chicago-based rapid microbial detection system manufacturer, for $212 million. In March 2014, the company acquired the CRO Services Division of Galapagos NV, including both Argenta and BioFocus, for $129 million. The company also acquired ChanTest, in October 2014, an Ohio-based company focusing on ion-channel drug discovery.

This most recent acquisition comes as cancer drugs and treatments are entering the market at an accelerated pace. According to an article in American Health and Drug Benefits, pharmaceutical company investments in cancer therapies “account for more than 30% of all preclinical and clinical development.” This is particularly relevant in oncology where, according to the article, new medications have been rapidly entering the market since 2014. 

Source: Charles River Laboratories