Dive Brief:
- AMAG Pharmaceuticals announced on Monday that it will acquire Cord Blood Registry (CBR), the world’s largest stem cell collection and storage company, for $700 million.
- Currently, CBR stores more than 600,000 umbilical cord blood and tissue stem cell units. It also partners with academic institutions to understand how stem cells can be used to treat diseases like autism, cerebral autism and pediatric stroke.
- CBR generated $126 million from pro forma revenue in 2014. AMAG expects that the acquisition will increase its opportunity for growth and also expand its ability to provide maternal services.
Dive Insight:
The acquisition is expected to boost AMAG’s earnings and could save the specialty pharma firm as much as $15 million in annual costs. AMAG is also expecting that its pro forma revenue will be above CBR’s 2014 levels.
The acquisition will allow AMAG to expand its maternal health services. When AMAG acquires CBR, it will have access to its digital and social media, consumer education and awareness program, which are expected to allow AMAG to better reach the maternal health market. It is expected that the acquisition will permit the company to provide obstetricians with better coverage and encourage healthcare providers to collaborate with the rest of the maternal health community.
When AMAG acquires CBR, it will also have the opportunity to diversify its revenue base.
"As modern medicine advances, cord blood stem cells will continue to be an important resource in harnessing the body's own potential to heal itself,” said Dr. Mahendra Rao, vice president for regenerative medicine at the New York Stem Cell Foundation Research Institute, in a statement.
“Because a person's own stem cells can be infused back into that individual without being rejected by the body's immune system, cord blood stem cells have become an increasingly important focus of regenerative medicine research."