Korean biotech PEF Medivate earns big via sale of Cognate BioServices

2021.02.18 14:16:26 | 2021.02.18 14:16:59

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Medivate Partners LLC, a South Korean private equity firm specializing in biotech buyouts, has cashed out on its investment Cognate BioServices (Cognate), a cell and gene therapy contract development and manufacturing organization (CDMO), nicely after the company was sold off to a U.S. bio company at $875 million.

Charles River Laboratories Inc., a U.S-based global leader in clinical tests and drug development services, announced on Wednesday (local time) in a press release that it acquired Cognate for $875 million in cash.

Medivate is one of shareholders of Cognate along with BlackRock and Oman’s sovereign wealth fund. The majority shareholder is EW Healthcare Partners.

The Korean PEF reportedly had invested about 60 billion won ($54 million) in Cognate from 2018 to January 2020. Its first investment of 47 billion won was made in February 2018 together with another Korean firm YJA Investment. Other global investors of Cognate, whose value was estimated at $125 million at that time, include BlackRock and Oman’s sovereign wealth fund.

In January 2020, Medivate became the second largest shareholder of Cognate by making additional investment in series B shares.

From the stake selloff, Medivate was reported to have earned more than three times its investment in Cognate.

Medivate initially sought listing Cognate on Korea’s secondary bourse Kosdaq, but it changed its plan after Charles River Laboratories offered to buy the company late last year.

Headquartered in Tennessee, U.S., Cognate offers comprehensive manufacturing solutions for cell therapies. It also runs development and manufacturing services for plasmid DNA and viral vector through Cobra Biologics it acquired in 2019.

Medivate was established in 2014 by Korean biotech specialists. The latest deal is the PEF’s fourth major cash-out. The firm achieved an internal return rate of 75 percent on its investment in Kosdaq-listed biotech firm SillaJen Inc. in 2016. Its other major investments include WCCT, a full-service early phase contract research organization (CRO) for the pharmaceutical, biotechnology and medical device industries based in the U.S.

By Kang In-seon and Cho Jeehyun

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