CAT Group agrees merger with Oxford Glycosciences
Cambridge Antibody Technology Group (CAT) and Oxford Glycosciences (OGS) have agreed the terms of a recommended merger to create a leading European biotechnology company. The transaction is expected to be completed during March, although as Manufacturing Chemist went to press there was speculation about rival bids, with Celltech named as one possible bidder.
If the CAT/OGS merger goes ahead, the enlarged group will have a stronger and broader portfolio, with two approved products, seven in clinical trials and seven pre-clinical products. It will also have significantly stronger core r&d capabilities by combining CAT's human monoclonal antibody product development expertise with OGS's oncology drug discovery capabilities and target pool.
Another benefit of the merger will be substantially greater financial strength for the enlarged group. This will increase its ability to fund product development to later stages, thereby retaining greater value, and reduce the need for additional capital. Cost savings based on the removal of duplicated corporate activities have been identified.
In addition, further savings are expected from a portfolio review to focus r&d expenditure on the highest quality projects. The review will be chaired jointly by Dr David Glover, who will remain as chief medical officer of CAT, and Professor Raj Parekh, currently cso of OGS, and the results will be announced in November 2003.
Following completion of the merger, CAT will continue to be chaired by Professor Peter Garland. Peter Chambre and John Aston will remain ceo and cfo respectively. Dr David Ebsworth, currently ceo of OGS, will be invited to join the CAT Board as an executive director to assist in the integration process, after which he will remain on the CAT Board as a non-executive director.
Garland commented: 'The merger with OGS is an important step towards CAT's strategic goal of building a profitable, product-based biopharmaceutical company over the next five years. It will significantly strengthen our core capabilities in therapeutic development, by enhancing our discovery, pre-clinical and clinical development capabilities, while adding strength and breadth to the product portfolio.'