Private Equity Firm Permira Seeks $4B Sale of CDMO Cambrex

Permira, a London-based private equity firm, is reportedly exploring the sale of contract development and manufacturing organization (CDMO) Cambrex in a deal that could value the company at up to $4 billion. The potential transaction underscores the growing investor interest in contract manufacturers, particularly amid the ongoing push for pharmaceutical manufacturing onshoring.

Permira's Strategic Move

According to a report by the Financial Times on September 6, Permira has initiated efforts to attract private equity buyers for Cambrex. The firm has approached approximately a dozen potential suitors and has enlisted advisors to launch the sale process. While a transaction is not guaranteed, Permira aims to secure a valuation of $4 billion for the CDMO.

Permira acquired Cambrex in 2019 for $2.4 billion, and under its ownership, the CDMO has made several strategic adjustments to its operations and reach. In 2023, Cambrex divested its drug product business unit to Noramco, an active pharmaceutical ingredient (API) manufacturer based in Delaware. This move was described by Cambrex CEO Thomas Loewald as a "strategic decision to focus on core areas of growth and investment."

Cambrex's Recent Developments

Cambrex has been actively expanding its capabilities and footprint in recent years. The company recently enhanced its Snapdragon Chemistry API facility in Massachusetts to bolster its peptide therapy capabilities. This expansion followed Cambrex's acquisition of Snapdragon and two of its plants in 2023, a move aimed at broadening its API offerings.

Currently, Cambrex operates 14 sites globally, with a focus on drug product and drug substance manufacturing, as well as analytical services. The company's diverse portfolio and strategic positioning have likely contributed to its attractiveness as a potential acquisition target.

Industry Trends and Private Equity Interest

The potential sale of Cambrex reflects a broader trend of private equity interest in CDMOs. This summer, Cambrex's competitor PCI Pharma Services received a strategic investment co-led by Bain Capital and Kohlberg & Partners, valuing PCI at $10 billion. Other recent transactions in the space include Ampersand Capital Partners and GHO Capital Partners' acquisition of CDMO Avid Bioservices, and Catalent's $16.5 billion sale to Novo Holdings.

These deals highlight the increasing importance of contract manufacturers in the pharmaceutical industry, particularly as companies seek to streamline their operations and capitalize on specialized manufacturing capabilities. The trend has been further accelerated by the U.S. government's focus on reshoring pharmaceutical production, with threats of steep drug import tariffs driving interest in domestic manufacturing options.