There has been a lot of interest in contract research organizations (CROs), contract manufacturing organizations (CMOs) and contract development and manufacturing organizations (CDMOs), especially in the M&A market. Half-way through May 2017, 19 of these deals have been  announced.

With 14 deals and $14 billion spent this year, CROs have taken the spotlight. But CDMO deals are picking up pace, accounting for 21% of the 19 deals and $7.3 billion spent this year.

Most of that total derives from one deal. On May 15, 2017, Thermo Fisher Scientific, Inc. (NYSE: TMO) acquired Patheon N.V. (NYSE: PTHN), a CDMO focused on active pharmaceutical ingredients (APIs) and finished drug product services.

The price was $7.2 billion, comprised of $35.00 per share and the assumption of more than $2 billion of debt, working out to 19.99x EBITDA and 3.74x revenue. The acquisition marks Thermo Fisher’s entry into the CDMO market, and Patheon will become part of its Laboratory Products and Services Segment.

Following Thermo Fisher’s announcement, Patheon shares were up 33.2% at $34.64.

Thermo Fisher entered into tender and support agreement with affiliates of JLL Partners and Royal DSM, whose collective holdings represent approximately 73% of Patheon shares, under which they will tender their shares in the transaction.

Patheon came a long way to be the CDMO giant it is today. Back in August 2009, Lonza Group AG (SWX: LONN) valued Patheon at $3.55 per share, or $460 million, in a deal that went toe-to-toe with a hostile bid of $2.00 per share launched by an affiliate of JLL Capital Partners. At the time, Patheon was generating annual revenue of $717 million and EBITDA of $82.6 million. In October of 2009, this deal was terminated.

Then, in November of 2013, Royal DSM, N.V. (Euronext: DSM) and JLL Partners purchased Patheon for $1.95 billion, or $9.32 per share, in a going private transaction. They combined it with DSM’s Pharmaceutical Products division to form a new company, intended to be a leading global CDMO with anticipated 2014 sales of about $2 billion.

At the time of this deal, Patheon generated $943 million in revenue and $188 million in EBITDA on a trailing 12-month basis, producing revenue and EBITDA multiples of 2.07x and 10.37x, respectively.

On June 8, 2015, Patheon registered for an initial public offering, and on July 20, 2016, it announced the IPO of 26,761,905 of its ordinary shares at $21.00 per share.