eureKING buys SCTbio to extend biomanufacturing push

Michael Kloss of eureKING

Special purpose acquisition company (SPAC) eureKING has agreed a deal to buy SCTbio as part of a plan to build a contract manufacturing company specialising in biologic therapies.

The SPAC – which was set up last year with investment backing of more than €150 million – is paying just over €13 million for 13-year-old SCTbio, which provides cell and gene therapy manufacturing, as well as logistical and regulatory support for biopharma clients.

eureKING is buying a 67% share in the company in cash, and the remaining third – currently owned by Czech investment group PPF Biotech – will be acquired through newly issued shares of eureKING, after which the SPAC will take full control of SCTbio.

It has already reached an agreement to buy Skyepharma, another contract biomanufacturing company, for an undisclosed amount, and is reportedly seeking additional assets in its quest to build a European contract development and manufacturing organisation (CDMO) market leader.

The combined company will enter a highly fragmented category, with thousands of players and just a handful of larger companies, notably Lonza, Boehringer Ingelheim, Catalent, WuXi Biologics, and Samsung Biologics, who share just over a quarter of the total CDMO market.

"By acquiring SCTbio and combining it with Skyepharma, we intend to build a solid network of production capacity in Europe with global reach," said eureKING's chief executive, Michael Kloss.

"This is a key transaction for eureKING's vision of becoming a new European bio-CDMO leader and contributing to Europe's ongoing critical need for sovereignty in the biomanufacturing value chain," he added.

PPF, meanwhile, said the transaction would allow it to "participate in the creation of a new European leader in the field of biotech manufacturing, whose shares will be traded on the Euronext stock exchange in Paris."

It said SCTbio will continue to provide specialised cell and gene therapy services to its SOTIO Biotech subsidiary, which is developing immunocytokine drugs, CAR-T therapies, and antibody-drug conjugates (ADCs) for cancer.

eureKING's founders also include former Sanofi chief executive Gerard le Fur, pharma industry veterans Christophe Jean and Hubert Olivier, and Alexandre Mouradian and Rodolphe Besserve of biotech investment group eureKARE.

The SPAC route to a public listing is being used by biopharma companies as an alternative to an initial public offering (IPO), as it can be quicker, simpler, and cheaper to complete, but also involves less scrutiny of a company's finances, liabilities, and operational processes.