M&A Transactions
March 2017 Financial Technology, Data, and Analytics
Publicly-held clinical testing company, LabCorp, rumored to be buying PPD, one of the largest CROs in the U.S. based in Wilmington, NC with a price tag of $8.0 billion.
Readers remember that LabCorp paid $6.0 billion for Covance, a large CRO in 2015. PPD, owned by Carlyle and Hellman & Friedman, was taken private in 2011 for $3.9 billion. We are not sure LabCorp’s shareholders like the deal. On the day of the announcement, the stock lost $800 million of its value but it has since recovered its loss. Beating its earnings estimate has clearly helped the cause. We will watch this closely but in the long run we think it makes sense for LabCorp to get into this business. Companies like Covance and PPD have huge visibility into the direction of diagnostics.
ABRY acquires MobileHelp, based in Boca Raton, FL for over $100 million.
MobileHelp started as a mobile medical alert company; in the PERS (Personal Emergency Response Systems) business. The product line is now expanded to include tablet-based monitoring devices where patients can track, monitor and share their vital signs. ABRY has a Midas touch and knows how to scale distribution businesses. This is a great platform with much promise in the health mobility space.
GoodRx and San Francisco-based Iodine enter into a merger agreement.
GoodRx, backed by Spectrum Equity and Francisco Partners, was launched in 2012. Essentially, they’re a drug price transparency company. People can use the app, enter the drug they are looking for, and their zip code, and the app shows a map of prices. Aetna provides a good deal of the data for the company. Iodine, which is a partner of Apple’s CareKit, is a crowd sourced content company behaving more as a search function which displays other people’s experiences on a variety of medications. This deal makes a lot of sense to us.
Warburg Pincus-backed Specialists On Call acquires NeuroCall based in Miami, FL.
Specialists On Call provides emergency telemedicine services. NeuroCall specializes in remote, neurological telestroke and teleneurology services. They also provide general neurology coverage via two-way real time video consultation. The target was the direct competitor of SOC. Between the two companies; they have conducted 280,000 neurology teleconsultations to date. They cover 350 acute care hospitals. This type of consolidation is inevitable in the emerging telemedicine space.
The cancer research arm of HCA, Sarah Cannon, buys Genospace based in Cambridge, MA from Thomson Reuters.
Genospace is a genomics company for precision medicine. The software stores large amounts of data, which enables doctors to analyze treatment options and can match patients to clinical trials. We are inspired by seeing health systems involved in scientific discoveries. That said, only a few organizations like HCA can afford to run their own clinical research organizations.
DrFirst buys Gainseville, GA-based VisibilityRx
The core competency of DrFirst is in its electronic prescribing/messaging capabilities. The company has 60,000 physicians on its platform. VisibilityRx is a clinical trial recruiting company; it is a powerful value proposition for doctors to be able to seamlessly refer patients for specific clinical trials. This deal advances the cause of patients with difficult diseases. We are excited to see this merger.
PARAXEL International acquires Kennesaw, GA-based, The Medical Affairs Company
As one of the most powerful CROs in the world, PARAXEL has a mighty reach. TMAC is a contract medical affairs company similar to a media agency. Essentially, whatever CROs do not want to deal with independently, be it sending medical team to talk to physicians or helping patients with product adoption or proper utilizations, companies like TMAC can do that heavy lifting for them. They even cover for CROs in medical meetings and provide booth coverage at healthcare conferences. Interesting acquisition.
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