UK-based contract research organisation (CRO) Premier Research Group has continued an energetic series of acquisitions since it went public in late 2004, snapping up US CRO ARS for up to $22.1 million and the Swiss D-TARGET for up to SwFr17.0 million ($14.1 million).
Both privately held companies are expected to be earnings accretive in the first year of integration. They offer a number of complementary synergies with Premier Research’s existing operations and will further strengthen the company’s position in the international CRO market, it said.
In particular, Weymouth, Massachusetts-based ARS will immediately consolidate the UK CRO’s presence in the growing New England biotechnology market, as well as bringing on board well-established capabilities and expertise in its Oracle Clinical database services, Premier Research noted. D-TARGET’s focus on the medical device industry will significantly expand on Premier Research’s current offering in this field, both in the US and Europe.
“We are delighted with the opportunity to expand both the depth and breadth of our offering in this way,” commented Dr Simon Yaxley, chief executive officer of Premier Research. “Both firms clearly represent a further important step in our strategy of building a leading international contract research organisation.” The two acquisitions had a number of key attributes in common, he added, including an “excellent industry reputation, top-quality staff, a complementary customer base, and a strong order book, giving high visibility of future earnings.”
A ‘strategic footprint’
ARS is a full-service CRO supplying the biotechnology, pharmaceutical and medical device industries. Its specialities include clinical monitoring, data management and Oracle Clinical database services. Among ARS’ current 33 customers, 28 will be new to Premier Research. The US company comes with a significant order backlog, worth more than $8.3 million, and will “provide a strategic footprint for Premier Research to access doctors and patients within the North East territory of the US”, the latter said.
Founded in 1998, ARS has shown “consistent and strong revenue growth given its project-based business” and has nearly doubled its revenues over the last two years, Premier Research noted. Audited net revenues for the 12 months to 31 December 2006 were US$9.2 million, while ARS reported earnings before interest, taxes, depreciation and amortisation (EBITDA) of around $2.1 million and pre-tax profit of $500,000.
Industry reputation
D-TARGET was founded in 1997 and has its base in Montagny-près-Yverdon, close to both Geneva and Zurich. It provides clinical research and regulatory services to medical device, combination product and biologics (tissue engineering) product manufacturers worldwide. The Swiss CRO has a strong industry reputation for regulatory compliance services throughout Europe, helping medical device manufacturers to get their products through the CE mark accreditation process, Premier Research said. An increasing number of companies are outsourcing this function as the regulatory regime becomes more complex, it added.
Of the 53 customers D-TARGET is currently working with, 50 will be new to Premier Research, the UK company pointed out. D-TARGET also has a substantial order backlog, worth more than $10.2 million, and will give Premier Research access to doctors and patients for clinical trials of medical devices across Europe. The Swiss company reported audited net revenues of SwFr7.8 million, adjusted EBITDA of SwFr2.4 million and adjusted pre-tax profit of SwFr1.6 million for the 12 months to 31 December 2006.
ARS and D-TARGET are Premier Research’s fifth and sixth acquisitions since it became a publicly traded company, following the takeover of US CRO SCIREX for up to $37 million last July.
