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Parexel buys Liquent for $72m

By Gareth Macdonald , 03-Jan-2013

Parexel has acquired niche regulatory information management software firm Liquent and raised its guidance for 2013.

The deal – which was announced late last month – values Liquent at $72m and – according to Parexel CEO Josef von Rickenbach – is designed to expand the contract research organisation’s (CRO) IT offering.

Through Liquent’s flagship software platform, InSight, our clients will have access to comprehensive regulatory agency submission planning, viewing, tracking, publishing, and registration management throughout the entire lifecycle of a medicinal entity.”

von Rickenbach explained that Liquent will enhance Perceptive Informatics, its eClinical business, through the additional of the InSight regulatory information management platform. He also suggested that Parexel’s consulting and medical communications services division would benefit.

Parexel increased its guidance for fiscal 2013, predicting earnings of between $1.675bn and $1.695bn from the $1.630bn to $1.660bn range it previously forecast. It also said that the US software firm will between $17m and $23m in service revenues by the end of the financial year on June 30.

Citi analyst Garen Sarafian was positive about the takeover in a note to analysts, suggesting that: “Strategically, it extends Parexel’s reach into the later stages of clinical trial development and allows the company to further vertically integrate.

Given the consolidation among CROs and the evolution from vendor to preferred provider to strategic partner, the expansion of services to offer partners regulatory information management offerings seems to be a natural extension.

He also suggested that, while none have been announced, cutbacks in countries where both Liquent and Parexel are present are a possibility.

From a cost synergy perspective, we note that Liquent has offices in the United Kingdom, Germany, and India. While we do not expect any cost synergies near or possibly medium term, it seems plausible to expect footprint cost synergies as Parexel is already present in those geographies.” 

However, Sarafian does not expect any future cuts to affect Liquent’s management, reasoning that the firms’ have already worked on joint RFPs for at least the past 5 years, or since circa 2007, which he said should mitigate “management turnover.” 

RIMs M&A

Horsham, Pennsylvania-based Liquent employs a staff of just under 300 people and Indian and claims to have more than 200 biopharma and life sciences clients.

The firm also has established agreements with other tech companies like electronic submissions specialist Take Solutions , which it partnered with in 2010.

The last major acquisition in the regulatory information management (RIM) services sector was Accenture’s August takeover of Octagon Research Solutions, which has a 380-strong team of experts on its books.

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