Under the "Biosafety Act": Taiwanese CDMOs make three acquisitions in six months, expanding into the U.S. market

In the 2024 top Contract Development and Manufacturing Organizations (CDMO) rankings published by the well-known life sciences media outlet GEN, Taiwanese CDMO companies have begun to emerge, being listed as rising stars to watch in the CDMO sector.

Under the Biosafety Act, Taiwanese CDMOs Expand into the North American Market

Due to the impact of the Biosafety Act, WuXi Biologics temporarily halted its expansion investment at its Worcester, U.S. base in the first half of 2024. Meanwhile, Pharmaron announced the sale of its wholly owned subsidiary, Pharmaron Hong Kong Investment, which held a 10.21% stake in Proteologix, to Johnson & Johnson for approximately $102.1 million.

Although there was only a slight decline in new orders from U.S. clients in the first half of 2024, and some hot sectors like ADCs (Antibody-Drug Conjugates) even saw growth, Chinese CDMOs are now forced to consider how to mitigate the "risks" of over-reliance on the U.S. market. They have begun diversifying their overseas investments, focusing heavily on Europe and Singapore, and implementing broader overseas capacity strategies to counter the negative impacts of the Biosafety Act.

In stark contrast to the diversified overseas strategies of Chinese CDMOs, Taiwanese CDMOs are accelerating their entry into the North American market through acquisitions of U.S.-based Chinese and Japanese-owned companies.

At the end of August, Bora Pharmaceuticals, headquartered in Taiwan, announced a strategic investment to acquire a 30.5% stake in Tanvex Biopharma, based in San Diego. Bora also plans to merge its wholly owned subsidiary, Bora Biologics (specializing in large molecule CDMO), with Tanvex. This move will add 1,000-liter reactors to complement its existing 500-liter facilities.

This investment combines Bora’s CDMO expertise with Tanvex’s scale, development skills, and FDA-approved San Diego facility, thus expanding its U.S. presence and mitigating potential disruptions caused by the proposed U.S. Biosafety Act. Bora will become the largest shareholder of Tanvex, and Bora Group's chairman, Sheng Bao-xi, is set to become the chairman of Tanvex in early 2025.

Tanvex Biopharma, a biotech company with Chinese investment, specializes in biosimilar development and also provides CDMO services for biologics, offering expertise from cell line development to FDA approval. Bora Pharmaceuticals, recently recognized by GEN, a leading media outlet in the biotech field, as one of the "Eight Emerging CDMOs to Watch in 2024", has been gaining attention in the industry.

Alongside the top ten global CDMOs for 2024, the eight "CDMOs to Watch" listed by GEN include AGC Biologics, Aldevron, Avid Bioservices, Bora Pharmaceuticals, Charles River Laboratories, Exothera, GenScript ProBio, and Viralgen.

Three Acquisitions in Six Months: Bora Pharmaceuticals Accelerates U.S. Business Expansion

In the past six months, Bora Pharmaceuticals has strengthened its presence in the U.S. market through three acquisitions.

In January 2024, Bora entered the U.S. market for the first time by acquiring Upsher-Smith Laboratories, a Minnesota-based generic drug manufacturer, for $210 million. Previously owned by Sawai Group Holdings (a Japanese pharmaceutical group) and Sumitomo America, Upsher-Smith has been operational since 1919 and has produced about 48 types of oral solid, liquid, and powder-form generics, including morphine, potassium chloride, and testosterone. The company operates facilities in Plymouth and Maple Grove, Minnesota, and has an office in Morristown, New Jersey. Its newly expanded, FDA-approved manufacturing facility has a total capacity of 3.5 billion doses, marking Bora's first local facility in the U.S. and establishing a key base for its global CDMO operations.

In June 2024, Bora further expanded its U.S. presence by agreeing to acquire the Camden fill/finish drug product facility in Baltimore for approximately $30 million. This facility, formerly owned by Emergent BioSolutions, spans 87,000 square feet and includes four filling lines that provide clinical and commercial non-viral sterile fill/finish services, such as lyophilization, formulation development, and support services. Around 350 employees from Emergent are expected to join Bora once the deal is completed, which is anticipated by the third quarter of 2024.

Bora’s strategic push into the North American market began in 2020, when it acquired a GSK manufacturing facility in Mississauga, Ontario. As part of the agreement, Bora continued producing over 50 GSK products at the facility for at least five years.

In 2021, Bora partnered with Taishin Healthcare Limited Partnership, committing up to $108 million to expand its CDMO investments and pursue a broader acquisition strategy. This laid the groundwork for Bora's recent acquisitions, culminating in its latest purchase of a 30.5% stake in Tanvex Biopharma, further extending its CDMO business in the North American market.