In a major reshaping of the pharmaceutical contract manufacturing landscape, Lonza has struck a deal to acquire the CDMO business of Merck KGaA.
Under the terms of the deal, Lonza will purchase the German Merck’s U.S.-based CDMO network for mid-triple-digit million euros. The addition of five manufacturing sites will more than double Lonza’s U.S. footprint to nine sites and is expected to contribute around 250 million Swiss francs ($305 million) in 2028 sales.
About 1,100 Merck KGaA employees are expected to join Lonza, bringing the Swiss CDMO’s U.S. headcount to more than 6,000.
The transaction comes as both companies double down on their core strengths as biopharma CDMOs aggressively expand their geographic footprints while large pharmas narrow their focus.
For Lonza, the acquisition “will significantly expand our U.S. presence, bringing us even closer to our customers, while increasing the resilience of our global manufacturing network,” CEO Wolfgang Wienand said in a statement.
Beyond mere physical expansion, the deal brings highly sought-after technical capabilities under the Lonza umbrella. The acquired sites will bolster Lonza’s prowess in rapidly growing sectors such as cell and gene therapy, bioconjugates, viral vectors and advanced drug-delivery technologies.
Within the legacy Merck KGaA portfolio Lonza is buying, one site in St. Louis, Missouri, offers bioconjugates services; Madison and Verona in Wisconsin are responsible for payload-linkers; Carlsbad, California deals with end-to-end viral vector solutions, including fill-finish; and Indianapolis, Indiana takes care of lipid nanoparticle, liposome and PEGylated protein solutions.
“Our customers are looking for partners who combine deep scientific expertise with the capabilities and scale to support increasingly complex medicines from innovation through to commercial supply,” Wienand said.
The anticipated 250 million Swiss francs in extra sales are relatively modest compared with Lonza’s total 6.5 billion Swiss francs sales in full-year 2025. But William Blair analysts called the deal “another highly attractive strategic acquisition for Lonza that meaningfully strengthens its competitive positioning across several attractive, high-growth modalities, positioning it well for its next leg of growth,” according to a Nov. 3 note.
The Merck portfolio is complementary to Lonza’s, the William Blair analysts said, pointing to the bioconjugation and payload-linker capabilities that fit well with Lonza’s existing antibody-drug conjugate facility in Visp, Switzerland. Within Lonza’s 2028 sales projection for the acquired business, about 60% to 70% is expected to come from Bioconjugation, according to an investor presentation.
The five sites give Lonza another major U.S. expansion following its $1.2 billion acquisition of a Roche plant in Vacaville, California in 2024. Lonza stands to benefit from high demand for U.S. capacity in light of the Trump administration’s pharmaceutical tariff threats and broader efforts to onshore pharmaceutical supply chains.
For Merck, the divestment marks “another important step in advancing our mid- to long-term strategic agenda,” group CEO Kai Beckmann said in a statement. The company is refining its Life Science department, known as MilliporeSigma, which offers a wide range of supports for customers across research, diagnostics and pharma. The CDMO network is a small part of that bigger franchise, which generated nearly 9 billion euros, or 42% of the German Merck’s total sales in 2025.
By offloading the CDMO unit, Merck will focus its future investments on its remaining portfolio of consumables, technologies and services used across biopharma development and manufacturing, including by Lonza. Notably, within its life science services offerings, Merck explicitly noted that its BioReliance contract testing services business is not included in the Lonza transaction.
The Merck-Lonza deal also arrives against the backdrop of further consolidation in the CDMO market following Novo Holdings’ massive $16.5 billion acquisition of Catalent in 2024 and Samsung Biologics’ recent purchase of its first U.S. site in a legacy GSK facility in Rockville, Maryland.