Charles River buys Brains On-Line to extend CNS research reach

Brain Research Boost

Charles River buys Brains On-Line to extend CNS research reach

Charles River Laboratories International, Inc. has purchased Brains On-Line, a leading contract research organization (CRO) offering critical data that advances novel therapeutics for the treatment of central nervous system (CNS) diseases. Realizing the potential of drug development for central nervous system diseases, especially neurodegenerative disorders, Charles River is paying $21 million for Brains On-Line, a small-cap CRO with operations in San Francisco, the Netherlands and Germany that has preclinical contract research services in CNS and in vivo efficacy and pharmacokinetics testing for analysis of drugs in the brain. In addition to the initial purchase price, the transaction includes potential additional payments of up to $8 million based on future performance.

Brains On-Line is considered the world’s premier provider of microdialysis for CNS research. Its testing protocols provide critical data required to advance potential CNS therapies through the development process.

According to James C. Foster, chairman, president and chief executive officer, “The addition of Brains On-Line strategically expands Charles River’s existing CNS capabilities and establishes Charles River as the premier single-source provider for a broad portfolio of discovery CNS services. In addition to enhancing our ability to support clients’ early-stage drug research in this critical therapeutic area, Brains On-Line expands our geographic footprint. This increases the opportunity for clients to work side-by-side with Charles River’s scientists, both in Europe and in the South San Francisco research hub.”

He added, ”For the biggest drug companies, it’s a constant process of focusing beyond therapeutic areas where they can distinguish themselves, and maybe getting rid of therapeutic areas where they can’t, vis-à-vis the competition … And, some of that’s going to have to do with whittling back their R&D infrastructures and organizations … To some extent, it’s accelerating the outsourcing trend.”

Foster believes that as more companies stop doing early tests internally, Charles River, which specializes in early-stage drug research, could garner more business. However, CNS has had its concerns recently.

According to an article by Angus Liu in Fierce Biotech (August 9, 2017), drugs for multiple sclerosis and other CNS disorders have had their rough times. While Roche’s Ocrevus was successful, MS expert Biogen discontinued development of the phase 3-to-be amiselimod and decided to advance opicinumab on the back of a phase 2 failure in 2016. While Celgene’s ozanimod met its primary endpoint in a pivotal trial, it failed to achieve a secondary disability endpoint.

Liu continued, “Research into neurodegenerative diseases like Alzheimer’s and Parkinson’s is also notoriously filled with disappointments. Not to mention the fact that GlaxoSmithKline is shutting its global neuroscience R&D hub in Shanghai in just a few months, cutting several programs amid a major shakeup championed by new CEO Emma Walmsley.”

During the second quarter of 2017, Charles River had revenue from continuing operations of $469.1 million. The company acquired Agilux Laboratories, WIL Research and Blue Stream Laboratories, which added 3.9 percent to an overall 8.1% revenue growth for that time period, while the sale of its CDMO business to Quotient Clinical in February allocated a 1 percent setback for the reported growth.