The acquisition, first mooted in October 2009, is designed to expand CBI’s presence in the global custom peptides market, which the firm predicts could be worth as much as $990m (€686m) this year.
Under the proposed deal CBI will receive all of the stock of the GL Biochem’s holding company, Wise Century Group, from its current shareholder in return for 78 per cent of its then-outstanding shares.
The merger, which still needs shareholder approval, will create the world’s largest supplier of preclinical peptide reagents and custom peptide synthesis services, demand for which is likely to increase according to Virginia-based CBI.
The firm explained that: “Large pharmaceutical and biotechnology companies typically have limited capabilities in-house but choose to outsource much of their research and development work to specialist providers such as GL Biochem.
“Pharmaceutical companies are now unable to generate the large number of necessary candidate compounds in-house, and this phenomenon has led to an increasing trend for outsourcing of drug discovery research.”
Shanghai, China-headquartered GL, its workforce of over 800 employees and two manufacturing facilities, are also a good fit for CBI in terms of its wider growth strategy in the emerging Asia-Pacific drug discovery sector.
The US contract research organisation (CRO) already owns a research unit in Shanghai through its Hong Kong-based subsidiare Venturepharm, which also has operations in Japan specialising in process scale-up, formulation development, manufacturing and clinical trial management.
Additionally, CBI also operates a dedicated peptide discovery and research organisations with its Sydney, Australia-based Mimotopes unit.