Information on the Target

Horizon Discovery Group plc (LSE: HZD), based in Cambridge, UK, is a prominent international life sciences company specializing in the provision of research tools and services for organizations involved in genomics research and the creation of personalized medicines. The company has reported exceptional growth and anticipates revenues for the full year 2014 to exceed consensus expectations by approximately 7%, translating to a total projected revenue of around £11 million. This marks an impressive growth rate of over 77% compared to the previous year, during which revenues were £6.7 million.

Expanding its capabilities, Horizon has successfully integrated two strategic acquisitions in 2014, which have not only broadened its service offerings but also affirmed its status as a leader in translational genomics. The acquisitions include CombinatoRx, focused on combination high-throughput screening, and Sage Labs, an in vivo model development company. Combined, these expansions position Horizon to deliver enhanced drug development solutions to a diverse range of customers.

Industry Overview

The global life sciences market is rapidly evolving, particularly in the field of genomics. Advances in technology and an increased focus on personalized medicine have paved the way for growth, as stakeholders from pharmaceutical firms to biotechnology companies seek innovative research solutions that can derive more targeted treatments and diagnostics for patients. With an estimated market size exceeding £29 billion, this sector is set to expand, benefiting organizations that leverage cutting-edge genomic research.

In the UK, where Horizon Discovery is headquartered, the life sciences industry plays a critical role in bolstering the economy and driving innovation. The country has become a hub for pharmaceutical development and genomic research facilitated by laboratories and academic institutions. This robust research environment, coupled with significant government investment in health technology, propels the industry forward.

Furthermore, the demand for advanced biopharmaceutical services continues to grow. The increasing prevalence of chronic diseases and the need for more effective therapies have prompted investment and collaborative initiatives between research institutions and healthcare providers. This growing acknowledgment of genomics as a transformative approach to medicine underlines the need for sophisticated tools and services such as those offered by Horizon.

With organizations increasingly seeking data-driven solutions, the focus on genomic research creates vast opportunities for companies like Horizon Discovery. Their commitment to advancing personalized medicine aligns closely with the industry's trajectory, ensuring they remain at the forefront of genomic innovation.

The Rationale Behind the Deal

The acquisition of Haplogen Genomics GmbH marks a strategic move for Horizon Discovery, enhancing their commercial offering significantly. The incorporation of Haplogen's haploid technology platform introduces a remarkable increase in the company’s cell line product inventory—from 1,000 to 10,000 cells—and production capacity, alongside significant cost reductions in production. This strategic acquisition not only broadens the company's product range but also expands its reach into the fast-growing academic research market, a sector previously unexploited by Horizon.

Such advancements enable Horizon to better serve clients engaged in drug discovery and development while concurrently solidifying their role in foundational genomics research. By expanding their product portfolio, Horizon not only enhances their market competitiveness but also diversifies revenue streams, fostering long-term financial stability.

Information about the Investor

Horizon Discovery is listed on the London Stock Exchange’s AIM market under the ticker

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