CRO Parexel has shifted its attention overseas with the acquisition of Atlas Medical Services, a provider of clinical research services in Turkey, the Middle East, and North Africa.
Istanbul-based Atlas, which has 35 employees and made about $4m in 2013, provides services across all phases of clinical development and will be integrated into Parexel’s clinical research services business.
Neal McCarthy, managing director of investment bank Fairmount Partners, told Outsourcing-Pharma.com, “Atlas is a very small business, and doesn’t move the needle on revenue,” noting the company “is about the size a single small Parexel study.”
“However, I think the acquisition shows two things: the region is important, as pharmaceutical customers, and more recently for their developing investments into pharmaceutical development, and Parexel wanted to get smarter about running trials in the region,” McCarthy said.
The acquisition was funded with existing cash and its impact on Parexel's FY 2015 revenue and earnings per share is not material, the company said.
Josef von Rickenbach, Chairman and CEO of Parexel said, "The acquisition of Atlas strengthens Parexel's presence in Turkey, the Middle East and North Africa. These markets are of increasing importance to our clients who are looking for market access and a broad spectrum of patient populations for clinical trials.”
The acquisition is the first for Parexel of 2014 and comes as the company just recently predicted 10% revenue growth for FY2015, which modestly outpaced investor expectations. That growth is far less than the “hyper growth” from FY2013, which von Rickenbach recently spoke to us about at the DIA annual conference.
Atlas, which was privately owned before the acquisition, has therapeutic expertise in oncology, hematology, endocrinology, cardiovascular, anesthesiology, infectious diseases and the central nervous system. The firm also works with more than 28 biopharma services companies including top 10 major biopharmaceutical companies, in addition to providing clinical trial-related services from study planning and feasibility, through site selection, data management and medical writing.
Atlas has two other regional offices in Turkey, in addition to qualified partners in Beirut and Paris, and regional offices of qualified partners from Algeria to Pakistan.
“Atlas has been a trusted business partner to Parexel for many years, and their infrastructure and staff are already aligned with our processes and operations,” von Rickenbach added. “By fully integrating Atlas into Parexel's global operations, we will enhance our ability to help clients more quickly achieve their goals of bringing important therapies to patients not only in Turkey, the Middle East, and North Africa, but also throughout the rest of the world."
He also noted Parexel’s interest in relatively smaller companies in our conversation from last month, which Atlas seems to be in line with.