Novo Holdings, the holding and investment company managing the assets of the Novo Nordisk Foundation, an enterprise foundation with philanthropic objectives founded in Denmark in 1924.  The holding company, which is also the controlling shareholder of Novo Nordisk and Novonesis, has agreed to acquire all outstanding shares of Catalent*, a CDMO working with pharma and biotech partners to optimize product development, launch, and full life-cycle supply for patients around the world.

The Catalent all-cash transaction values Catalent at $16.5 billion on an enterprise value basis.

Following the merger, Novo Holdings intends to sell three Catalent fill-finish sites and related assets acquired in the merger, in which Novo Holdings has a controlling interest. These three sites are located in Anagni, Italy; Bloomington, Indiana, USA; and Brussels, Belgium.

According to various M&A experts and representatives of both companies, this transaction is aligned with Novo Holdings’ strategy of investing in established life science companies with strong long-term potential.

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“Over the past several years, Catalent has built a comprehensive end-to-end offering of services and capabilities to drive innovation in the healthcare system and improve patient outcomes, noted Alessandro Maselli, President and Chief Executive Officer of Catalent.

“This transaction is a testament to our team’s hard work and dedication to this mission, and I am incredibly excited for this next step in our journey. We look forward to benefiting from Novo Holdings’ significant resources to accelerate investment in our business and enhance key offerings as we continue to offer premium development and manufacturing solutions for pharma and biotech customers,” Maselli added.

“This transaction delivers significant, certain and premium value to our stockholders. Novo Holdings believes in our vision and will provide Catalent with a strong foundation as we continue developing, manufacturing and supplying top products,” said John Greisch, Executive Chair of the Catalent Board and Chair of the Strategic and Operational Review Committee.

Novo Holdings has a proven track record of successfully investing in the broader life sciences sector. And this new acquisition further confirms the company’s long-term strategy.

“We are excited to partner with Catalent as it enters a new phase of growth and accelerates its mission to develop, manufacture and supply products that help people live better and healthier lives,” noted Kasim Kutay, CEO of Novo Holdings.

“With our expertise and track record of investing in high quality life sciences businesses, we believe Catalent is a very good strategic fit. We are excited to support the Company’s stakeholders in the years ahead, especially employees and customers as they work to develop new products to benefit patients. As engaged investors committed to productive relationships with all our partners, we look forward to working with the Catalent team to realize the Company’s full potential. Importantly, our acquisition of Catalent is aligned with our mandate to invest in high quality life sciences companies for the benefit of the Novo Nordisk Foundation’s mission and philanthropic causes,” Kutay added.

Investor sentiment
“As a significant investor in Catalent, Elliott Investment Management fully supports the transaction announced today,” said Marc Steinberg, Partner at Elliott Investment Management L.P

“We believe that this transaction, which is the culmination of a process led by the Strategic and Operational Review Committee of the Catalent Board, clearly maximizes value for Catalent stockholders. We commend Catalent’s Board and management team for delivering this outstanding outcome,” he noted.

The merger is expected to close towards the end of calendar year 2024, subject to customary closing conditions, including approval by Catalent stockholders and receipt of required regulatory approvals. The transaction is not subject to any financing contingency.

Antibody-drug Conjugates
Catalent is developing the SMARTag® technology platform which offers developers of antibody-drug conjugates a toolkit to develop optimized ADCs and bioconjugates. The technology overcomes the limitations associated with conventional protein chemistries that produce heterogeneous products with variable conjugate potency, toxicity, and stability. It also enables site-specific, controlled drug-protein conjugation and uses only naturally occurring protein modifications requiring minimal cell-line engineering. The SMARTag® technology is agnostic to payload and is compatible with cytotoxic and non-cytotoxic payloads, including nucleic acids and peptides.

Catalent has multiple partnerships with companies, including Exelixis, under which Catalent’s Redwood Bioscience subsidiary is developing multiple antibody-drug conjugates (ADCs) for Exelixis using Catalent’s proprietary SMARTag® site-specific bioconjugation technology.

Note: *US $ 63.50 per share, a 16.5% premium to the closing price of Catalent’s common stock as of February 2, 2024, the last trading day before the companies announced the merger agreement,  and a 47.5% premium to the 60-day volume-weighted average price as of February 2, 2024.

Featured Image: Catalent during the 2016 CPhI World Wide. Courtesy: © 2017 – 2018. Sunvalley Communication, LLC / Evan Wendt. Used with permission.

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