Shares of Patheon were up about 33% in premarket trading, just shy of the offer price of $35 per share, representing a premium of about 35% to Patheon’s Friday close.

Thermo Fisher (TMO), which supplies the biopharmaceutical industry with research, clinical trial and production services, will benefit from Patheon’s drug manufacturing abilities as drugmakers increasingly try to cut costs and reduce clinical trial times.

“Thermo Fisher already had a developing and strong position in clinical trial manufacturing and now expands that arm into drug manufacturing, which is likely to highlight its growing presence in the market of bioproduction and bioprocessing,” Leerink analysts wrote in a client note.

The contract research space is in the midst of a wave of consolidation with INC Research Holdings last week saying it would merge with inVentiv Health in a $4.6 billion deal to help it win contracts with large pharma companies.

The Patheon deal, including debt, represents a purchase price of about $7.2 billion, the companies said in a statement. Patheon, which went public last July, generated about $1.9 billion in revenue last year.

The transaction is expected to be completed by the end of 2017 and will immediately add to Thermo Fisher’s adjusted profit by 30 cents in the first full year after close.

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

The company, which has obtained committed debt financing from Goldman Sachs Bank USA and Goldman Sachs Lending Partners LLC, expects to finance the deal with debt of about $5.2 billion and the rest with equity.

Goldman Sachs & Co is acting as financial adviser to Thermo Fisher, and Wachtell, Lipton, Rosen & Katz is serving as legal counsel.

Morgan Stanley & Co is Patheon’s financial adviser, and Skadden, Arps, Slate, Meagher & Flom is its legal counsel.