A life science logistics company that recently moved its headquarters to Brentwood has announced the acquisition of a global competitor for $57.7 million. The move expands its market reach by 22 locations that serve more than 150 countries.
Cryoport, which moved from Southern California to a 4,000-square-foot office space in Maryland Farms in February, markets temperature-controlled logistic solutions for the biopharma, human reproductive and animal health industries, with its main source of revenue being supply chain networks in the cell and gene therapy space.
CEO Jerrell Shelton said the company had been targeting the acquisition of Paris, France-based CRYOPDP for “considerable time” but that recent forecasts of increased demand by clients in key industries drove the decision.
“The acquisition of CRYOPDP is the result of these conversations and is based on the need to broaden our global network to handle the upcoming wave of global commercial therapy approvals,” he said on a call with investors on Friday morning.
The transaction is set to close within 60 days with Cryoport funding it with cash on hand. The deal will add 220 employees to Cryoport's network.
With locations across 12 countries — including a presence in Africa, Europe, the Middle East and Asian-Pacific regions — Shelton said CRYOPDP broadens his team's supply chain network in high-growth areas for cell and gene therapy research with limited overlap in capabilities and infrastructure, from a geographic standpoint as well as service and product support.
Vice President of Corporate Development Tom Heinzen anticipates the acquisition will bring on nearly $100 million in revenue over a five-year period as Cryoport shifts CRYOPDP’s operations to largely support the higher-margin business of cell and gene therapy and research logistics. CRYOPDP has grown revenues 10 percent since 2017 to more than $49 million last year.
“The unification of a Cryoport and CRYOPDP networks really propels us a couple of years in the future by instantly filling out our global network and our client base,” Heinzen said.
Shares of Cryoport (Ticker: CYRX) popped on the news Friday. At about 2 p.m., they were up more than 12 percent to about $38.40. Year to date, they have now more than doubled.