Forge Biologics Inc. has agreed to a $620 million acquisition after just three years in business.
Ajinomoto Company Inc., a Tokyo-based maker of nutrition products, expands into healthcare with the all-cash deal for the Grove City biotechnology startup, according to a news release. Forge manufactures the biological materials used in gene therapies and is developing its own proprietary treatments for rare inherited diseases.
"We set out to build a company with a mission to enable access to life-changing discoveries, and this transaction will support us in advancing that mission into our next global stage of development to expand our capabilities and platform for the benefit of our clients and their patients," co-founder and CEO Timothy Miller said in the release.
Forge had raised $250 million in venture capital from Columbus-based Drive Capital and other investors, and had an $80 million credit facility.
After paying off debt, $554 million goes to the shareholders, according to a release from Ajinomoto and a Forge spokeswoman. Typically VC looks for a greater multiples in return, but in a much longer time frame.
The deal is expected to close by year's end, pending regulatory approvals.
Forge has grown to more than 300 employees in its 200,000-square-foot manufacturing and research facility. Revenue grew by "multiples" in 2022, its second full year of biotech manufacturing, and this spring executives projected another leap for this year.
Joining the global firm will propel Forge's growth even faster and "maximize the impact they have on their mission for clients and patients," Chris Garabedian, CEO of investor Perceptive Xontogeny Venture Fund and Forge's chairman, said in a statement.
“This acquisition in the current biotech market is a remarkable testament to the technical advancements, world-class facility, and experienced capable leadership at Forge," Garabedian said.
“Forge’s unparalleled expertise in gene therapy development and manufacturing will be a transformative addition to our core growth area of healthcare," said Yasuyuki Otake, Ajinomoto's general manager for biopharma services.
Ajinomoto had $10 billion revenue in 2022. The company has a contract manufacturing arm using clean-room processes similar to the biotech's.
Forge's lead financial adviser in the deal was Centerview Partners LLC and Ice Miller LLP its legal adviser, the release said. Chardan Capital Markets LLC provided financial advice.
Biotech veterans, including from successfully acquired gene therapy companies, founded Forge in 2020. The first gene therapy it's taking through the U.S. and European regulatory process delivers a copy of the missing gene in Krabbe disease, an enzyme deficiency usually fatal by age 2. Infants treated over a year ago in the study are showing normal muscle and brain development.
