Interesting News in Healthcare Q3 2020

 

Healthcare Newsletter
Q3 2020

Deals, Investments                                                                                                                                    

There were 585 deals representing a total reported transaction value of $110.7 billion during the third quarter of 2020, within the market for healthcare and healthcare service businesses that support the life sciences industry.  This compares to 715 deals with a reported value of $85.2 billion during Q3 of 2019, an 18% decline in quarter-over-quarter number of deals, but a 30% increase in deal size.  This trend — fewer but larger deals — already ongoing seems to have been accelerated by the pandemic in the United States.

The largest publicly reported deal during the quarter was Gilead’s $21 billion purchase of biotech Immunomedics, including its highly valued breast-cancer drug. Also noteworthy was Kohlberg’s investment in PCI Pharma Services, Odyssey’s purchase of ProPharma from Linden Capital and the $18.5 billion strategic investment by Teladoc of Livongo. Other deals included Doximity, Fishawack, Healthline and W20; deal verticals included continuing medical education, data analytics and software services.

Kohlberg Becoming Owner of PCI Pharma Services in $3B+ deal

PE firm Kohlberg & Co. reported that it had agreed to acquire a majority stake in pharma supply chain outsourcer PCI Pharma Services. PE Hub reported that the transaction was for more than $3B, based on a $170M EBITDA.
 
  • The Partners Group, previously PCI’s PE majority owner, will retain a minority stake. In 2016 The Partners group acquired a majority interest in PCI Pharma from Frazier Healthcare, based on a $1.1B valuation, according to The Wall Street Journal.
  • PCI Pharma Services provides a broad range of integrated pharmaceutical supply chain solutions from the earliest stages of drug development through to commercial launch.
  • The company supports services that includes clinical trials and commercial packaging — with 25 facilities across six countries has more than roughly 3,000 employees worldwide.
  • The firms did not disclose terms.
CompanyPrice ($mm)Revenue ($mm)EBITDA ($mm)Price/RevPrice /EBITDA
PCI Pharma Services>3,000.0170.0>17.6x

PE Hub, The Wall Street Journal


Odyssey acquires ProPharma Group

ProPharma Group, a pharma regulatory and compliance services company is being acquired by PE firm Odyssey from Linden Capital Partners. ProPharma was founded in 2001 and is based in Overland Park, Kansas.
 
  • The company’s primary service offerings include regulatory affairs, life science consulting, pharmacovigilance and medical information services.
  • Financial terms were not disclosed.

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