Private equity firm Bain Capital (BCSF) is paying $3.4 billion to buy a 350-year-old Japanese drugs group fighting diabetes and cancer with “precision medicine”.
Discover the Best Stocks and Maximize Your Portfolio:
- See what stocks are receiving strong buy ratings from top-rated analysts.
- Filter, analyze, and streamline your search for investment opportunities with TipRanks’ Stock Screener.
Bain has snapped up Mitsubishi Tanabe Pharma from owner Mitsubishi Chemical with the deal expected to close in the third quarter this year. Bain’s share price was up by 1.44% in pre-market trading. Osaka-based Mitsubishi Tanabe Pharma, which can trace its roots back to 1678, uses what it calls “precision medicine” to create a pipeline of drugs tackling several diseases and conditions from immunology & inflammation to vaccines, central nervous system (CNS), diabetes and metabolic disease. It employs over 5,000 people worldwide.
Japan Keen to Ramp up Drug Innovation
Bain Capital said there are “promising signs for growth and untapped opportunities” in Japan’s life sciences sector as the government and regulators strive to ramp up the development and approval of innovative medicines. Conditions like diabetes and cancer could also impact more people in the years to come as the global population increases and ages.
Japanese firms are increasingly being targeted by overseas private equity groups as companies look to offload non-core businesses. This is partly because they are under pressure from Japanese authorities to raise corporate and shareholder value.
Bain to Invest in Drugs R&D
It is understood that Mitsubishi Chemical was also keen to sell because it could not fund the large-scale investment needed to boost Tanabe’s research and development capacity. Ricky Sun, a Partner at Bain Capital Life Sciences said a key aim would be to increase Mitsubishi Tanabe’s “long-term drug development in areas of significant unmet need to ultimately bring transformative medicines to patients in Japan and globally.”
Is BCSF a Good Stock to Buy?
On TipRanks, BCSF has a Moderate Buy consensus based on 1 Buy rating. BCSF stock’s consensus price target is $18 implying an 0.22% downside.
