Repligen Corporation announced recently that it has acquired the business of Refine Technology (“Refine”), including Refine’s Alternating Tangential Flow (“ATF”) System, a market-leading device used to significantly increase product yield during the fermentation step of the biologic drug manufacturing process. The acquisition strengthens Repligen’s bioprocessing business by adding a profitable and highly complementary product line while expanding the Company’s direct sales presence worldwide.
Repligen has entered into a definitive agreement effective June 2, 2014 to purchase Refine’s business for a combination of $20.5M in cash and 215,285 shares of Repligen common stock, for total upfront consideration of approximately $24.5M. The agreement also includes contingent milestone payments of up to $8.75 M based on defined revenue targets through the year 2016, a capped royalty provision of up to $2.15M for above-target sales during the same period. The Company expects ATF System sales to add approximately $3.5-4.0M in revenue for the remainder of the year 2014.
“The Refine purchase is a significant step toward the realization of Repligen’s goal to build a best-in-class bioprocessing company. We continue to execute on this goal by supplementing our organic growth strategy with the acquisition of the market-leading ATF product line used by biopharmaceutical manufacturing customers worldwide,” said Walter C. Herlihy, Ph.D., President and CEO of Repligen. “The significant overlap of Refine’s customer base with our own will support a global buildout of our commercial infrastructure.”
About the ATF System
The ATF System is a filtration device used by many of the world’s largest biopharmaceutical companies and contract manufacturing organizations to improve product yields during the fermentation step of biomanufacturing. By continuously removing waste products from the fermentor, the ATF System routinely increases cell densities to 2- or 3-times the levels achieved by standard batch fermentation. As a result, product yield is increased which improves facility utilization and can reduce the size of a bioreactor required to manufacture a given volume of biologic drug product.
The ATF System is available in a range of sizes from lab scale to commercial manufacturing and is used in the production of several FDA-approved drugs. Repligen plans to develop a single-use, consumable version of the ATF System for customers who are building or employing manufacturing facilities with single-use bioreactors.
Revised 2014 Guidance
As a result of Repligen’s acquisition of the business of Refine, the Company is revising its financial guidance for the year 2014. Total product revenue for 2014 is expected to be $56-$59 M compared to previous guidance of $52-$55 M. This revised estimate reflects 18%-24% annual revenue growth, an increase from previous guidance of 10%-15% growth. Product gross margin for the full year 2014 is expected to be 51%-53% and total operating income for the full year is expected to be $10-$12 M, a decrease from previous guidance of $11-$13 M. This decrease is primarily the result of one-time transaction and inventory related expenses and increased expenses related to the expansion of the Company’s commercial operations. Net income for the full year 2014 is expected to be $8-$10 M. Cash and investments at year end are expected to be $62-$66 M.
Webcast Presentation & Conference Call
Repligen management will discuss this acquisition and other business updates during a webcast and conference call scheduled for today, June 3, 2014 at 9:00 a.m. EDT. The webcast slide presentation will be accessible via the Investor Relations section of Repligen’s website www.repligen.com; see News & Events, Events & Presentations.
About Repligen Corporation
Repligen Corporation is a life sciences company focused on the development, production and commercialization of high-value consumable products used in the process of manufacturing biological drugs. Our bioprocessing products are sold to major life sciences and biopharmaceutical companies worldwide. We are the leading manufacturer of Protein A affinity ligands, a critical component of Protein A media that is used to separate and purify monoclonal antibody therapeutics. Our line of ATF (Alternating Tangential Flow) filtration devices and our growth factor products are used to increase product yield during the fermentation stage of biologic drug manufacturing. In addition, we developed and market an innovative line of “ready-to-use” chromatography columns under our OPUS brand (Open Platform User Specified) that we deliver pre-packed to our biopharmaceutical customers with their choice of purification media. Repligen’s corporate headquarters are in Waltham, MA (USA) and our manufacturing facilities are located in Waltham, MA and Lund, Sweden.
SOURCE: Repligen Corporation