As the new year arises we pause to reflect on 2019 and the highlights of the year.
The big buzz in the North Texas life sciences community was the acquisition of Peloton Therapeutics by Merck & Co. for $2.2 Billion just weeks after Peloton filed for an IPO. Unicorns are rare and the fact that North Texas has seen two in the past four years with at least two near unicorns in that same period speaks to the increasing presence of our life sciences community on the world stage. I imagine we are not far from at least one $1B+ acquisition yearly, with a local company either acquiring or being acquired. Life sciences M&A activity in 2019 included:
- Medisource Partners acquired by Generex Biotechnology
- Aprima Medical (Dallas) acquired by eMDs Inc (Austin)
- eCore Software (Dallas) acquired by ESO (Austin)
- Peloton Therapeutics (Dallas) acquired by Merck $2.2B
- Corepoint Health (Frisco) merged with Rhapsody (Boston)
- ThermiGen (Irving) acquired by Celling Biosciences (Austin)
- VitreosHealth (Plano) acquired by HMS Holdings (Irving) $36.5M
- Vivify Health (Plano) acquired by Optum, a division of UnitedHealth Group
- Emergent Cold (Dallas) acquired by Lineage Logistics (Michigan) $900M
Of the 37 registered M&A activity of 2019 more than 24% were life sciences deal.
A few of you may be asking why Emergent Cold, a cold storage company, is included in this list of life sciences M&A activity and the answer is a new word that is already making an impact in the life sciences – biologistics.
Biologistics is defined as the management of the safe flow of high value, temperature sensitive, and time-critical biological materials as they are delivered for patient care, analyzed for diagnostic purposes, processed to higher value products or stored to meet physical and data archival needs.
In 2019 Dallas-Fort Worth International Airport made North Texas a beachhead in the industry with the announcement of the organizations move into BioLogistics by becoming CEIV certified, one of only two airports (Miami being the other) with such designation in the United States. DFW’s vision includes a robust “biotech silk road and innovation hub” that sees goods being shipped worldwide in the most expedient and safe manner with full “lab to delivery” tracking of sensitive materials. DFW is one of few airports that can pull this off on a global level due to its geographic advantage – only Chicago and Houston can offer non-stop flights to the locations spanning Australia to Mumbai. Chicago’s cold winters provides it with a significant disadvantage.
If you don’t think this is big news let me just point out that immediately on announcement international biologistics companies such as SkyCell started to up their presence in the region.
As if that isn’t proof enough, life science companies have been relocating or opening offices in the region due to its location. The largest has been McKesson relocating their headquarter to Irving but smaller players such as Lake Pharma saw the opportunity before the DFW Airport announcement and opened labs in Irving near the airport.
Lake Pharma’s decision to move their headquarter from San Francisco to North Texas was driven by its distribution ease, their ever-growing Texas client base, the cost of doing business, and the quality of life for its employees with key employees relocating to the region. They have no intent to close their locations in San Francisco and Boston but see North Texas as the hotbed of growth evidenced by the unicorns and near unicorns in North Texas and especially following the passing of an additional $3B in funding for the Cancer Prevention and Research Institute of Texas (CPRIT).
CPRIT is a big win for Texas and the North Texas life sciences community. It attracts talent and companies to our great State. It is a model that other states are scrambling to replicate. It is the reason companies like OncoNano, which received much of its funding from the coasts, is here in North Texas.
2019 was a win for the North Texas life sciences community. We are excited to see where 2020 will take us. One thing is sure – we will see more acquisitions, relocations and leadership in biologistics and cancer therapies and research.