Tar ⚡ Profile picture
Nov 19, 2021 18 tweets 5 min read
Why did #LaurusLabs bought a significant minority stake (26.62%) in a cell and gene therapy startup (ImmunoACT)?

A short thread 🧵👇🏽⤵️ Image
The entire motive behind acquisitions can be understood by understanding what #LaurusLabs is trying to do with its Biologics vertical.

A snippet of this can be found in interviews of Dr.Chava at the time of acquisition of Richore. Image
Biologics is a high gestation and high investment area within the Pharma industry

Typical development times range in many years and take about 5+ years on average to really scale up and transition to commercial production

This also translate into high barriers of entry
By acquiring Richcore, Laurus circumvented all of that and got itself the technical skills required to build a foundation for a Biologics business. ImageImage
Laurus's strength has always been scale and research which ultimately helps it in becoming a lowest cost supplier in the areas it operates.

They used the same business philosophy to transition from a CRO to a ARV API supplier in its early days.
Whatever Laurus learnt while doing CRO functions for other pharma companies, it used that knowledge to perfect the process to make ARV APIs.

Within few years of supplying ARV APIs, Laurus became a lowest cost producer and ultimately dominated market share in that space.
That same philosophy is being repeated to set up its Biologics arm.

Here is a snippet from the Dec'20 concall on Richcore acquisition. Image
As you can see from the earlier snippet, instead of going after the highly competitive market of Biosimilars, Laurus opted to scale up capabilities of Richcore and enable it to commercialize its already cost competitive process of making recombinant proteins.
Recombinant proteins market today is not as competitive as biosimilars and within a few years of perfecting the process to make them, Laurus would soon repeat what it did with ARV APIs - making the lowest cost product in the world.
All of that brings us to why - ImmunoACT?

A company that has nothing to do with recombinant proteins but is working on CAR-T and cell therapies. Image
The answer is technical expertise.

ImmunoACT has the technical knowledge that can help Laurus add another offering to its Biologics arm.

I believe eventually, this minority stake today will become an outright majority acquisition within next 2-3 years . Image
ImmunoACT is also not just random company, its a IIT Bombay incubated start up that has some of the leading experts on its board and is run by highly talented faculty of the institute. Image
The advisors and scientific board at ImmunoACT Image
Meet Prof. Rahul Purwar, the founder of ImmunoACT Image
As #LaurusBio matures, so will the various product and service offerings of the company, and its my prediction that most of these will come via the way of acquisitions or acqui-hires.
What we are witnessing today, is the birth and foundational set up of what may eventually become a primer biologics business originating out of India within the next decade.
Here is an old article on ImmunoACT, if you want to read.

Thank you for reading!

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