The acquisition of Kansas-based Vince in mid-May by Canada-based Altasciences shows an increasing interest in service providers that can target specific patient populations for complex early development programs, David Blume, co‐founder and managing director at investment bank Edgemont Capital Partners told Outsourcing-Pharma.com.
The purchase of Vince also further positions the private equity (PE) company Kilmer Capital Partners in the US. In addition to owning Altasciences, the company owns Algorithme Pharma, a Montreal-based full service early stage clinical CRO. Private equity companies’ interest in CROs seems to be on the uptick as firms recently showed interest in acquiring the CRO PRA International.
Blume declined to reveal the price of the Vince acquisition but said it was “one of the larger deals for a clinical research site,” noting that Edgemont deals mostly with transactions between $20m and $250m.
Edgemont, which acted as the exclusive financial advisor to Vince, also helped complete a similar deal when the CRO QPS purchased Miami Research Associates (MRA) in February. Blume noted the similarity of the two deals, which reveals the “substantial evolution” in the way Phase I clinical trials are now conducted.
CROs have historically run Phase I trials in house but are now outsourcing work for more complex trials because of the difficulty and the expertise required to recruit such patients, Blume added. “But [CROs] are still trying to figure out their longer-term strategy” in setting up partnerships or preferred provider relationships.
Once the FDA came on board with the use of patients instead of healthy volunteers for early development, sponsors shifted immediately because of the benefit of efficacy data, he said. However, to date, CROs have elected not to acquire companies like Vince and MRA, and have instead opted for outsourcing the work, Blume said.
He also said other small Phase I research companies entirely concentrated on early development and similar to MRA and Vince are out there for future purchases, though those two are the “larger ones.”
“Vince and [MRA] do studies across a wide range of therapeutic areas,” Blume said. “But there are companies that have a high-degree of specialization that could be big targets for acquisitions.”