Lonza to acquire five US manufacturing sites from Merck in expansion drive

SWITZERLAND — Lonza Group AG has agreed to acquire five US contract development and manufacturing organization (CDMO) facilities from Germany’s Merck KGaA to expand its manufacturing capacity and strengthen its presence in the US biopharmaceutical market.

The transaction, valued in the low- to mid-hundreds of millions of Swiss francs, will increase Lonza’s US manufacturing footprint from four to nine sites and add approximately 1,100 employees.

The acquisition will bring its total US workforce to more than 6,000.

The five facilities cover several specialised manufacturing technologies.

They include a bioconjugates site in St. Louis, Missouri; two facilities in Madison and Verona, Wisconsin, specialising in high-potency payload-linkers; and a Carlsbad, California, site focused on viral vector solutions and aseptic fill-finish services.

The fifth facility, located in Indianapolis, Indiana, provides lipid nanoparticle, liposome and PEGylated protein solutions, alongside aseptic fill-finish capabilities.

Expanding specialised manufacturing capabilities

The acquisition aligns with Lonza’s One Lonza Strategy, which focuses on expanding its contract development and manufacturing capabilities across key biopharmaceutical technologies.

Chief Executive Officer Wolfgang Wienand said the transaction reflects the company’s approach to capital allocation and investment in opportunities that support long-term growth and financial returns.

The acquired facilities are expected to generate approximately CHF 250 million (US$280 million) in sales in full-year 2028.

Their CORE EBITDA margin is projected to remain below Lonza’s group margin initially, with an insignificant impact on the company’s overall financial performance.

Lonza expects the acquired businesses to reach peak sales at its future group margin level by the mid-2030s.

The expanded network will strengthen Lonza’s capacity across bioconjugates, high-potency compounds, viral vectors and lipid-based delivery technologies.

These capabilities support the development and commercial manufacturing of complex biologics, including advanced therapies and targeted drug delivery products.

The additional facilities will also give biopharmaceutical companies access to a broader range of specialised manufacturing services within Lonza’s US network.

Financing and transaction timeline

Lonza will finance the acquisition through available cash resources and existing credit facilities.

The company expects to maintain its BBB+ credit rating following the transaction.

Completion is expected in mid-2027, subject to customary closing conditions and regulatory approvals where required.

Until the transaction closes, the five facilities will continue operating independently under their existing arrangements.

Lonza also confirmed that its 2026 financial outlook and Organic Growth Model remain unchanged.

The acquisition will not affect its previously announced share buyback programme, which followed the divestment of its Capsules & Health Ingredients business.

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