Quintiles looks to acquire new assets outside the US, CEO says

By Zachary Brennan contact

- Last updated on GMT

Quintiles looks to acquire new assets outside the US, CEO says

Related tags: Ceo tom pike, Mergers and acquisitions

With operations in more than 100 countries, the world’s largest CRO Quintiles is now looking to extend its global reach even farther, CEO Tom Pike told investors at the Barclays Global Healthcare Conference on Tuesday.

Pike said that the company found that with its most recent acquisition of Novella​, that Quintiles can take a smaller, more specialized CRO and “they benefit greatly from coming to us​” because of Quintiles’ depth and reach.

He added that the company is now looking for “non-US based acquisitions​,” as well as acquisitions that can help them improve their analytical business, which falls under the IHS (Integrated Healthcare Services) division.

But the mostly positive Pike also noted – perhaps in a nod to Abbvie’s $21bn purchase of Pharmacyclics​ – that although Quintiles continues to look around the world for acquisition targets, the company is also “financially disciplined and the assets are high priced right now​.”

As far as Pike’s perspective about the need for consolidation among smaller and mid-size CROs – which Pike previously said can’t compete with their larger counterparts​ – he noted that eventually the industry will reach a level where there are three or four “major players​.” But he said that given the pricing environment, it “may take a couple of business cycles to see more consolidation​.”

Pike also noted that Quintiles is increasing its focus on small biotech clients as there has been a 46% increase in funding for small biotech, which has been reflected in RFP volume.

In comparison to large pharma and biotech firms, which usually have “very specific requests about the design of the trial and have good FDA relationships​,” small biopharma often have no clinical development experience at all, Pike said, noting that Quintiles has a separate group that sells services to small biopharma and another group of analysts that look at both the financing of small biotechs and the quality of the compounds in development when deciding which opportunities the company would like to pursue.

Strategic Partnerships

The breadth and depth of Quintiles allow it to do sole-source deals, Pike added, though most of those deals are done with mid-size biopharma. “Most clients would prefer to be with one partner rather than teach multiple partners…and some like Biogen and Merck are able to do that​,” Pike said, referring to two of Quintiles’ strategic partners.

When they’re larger, they’re likely to use more partners​,” Pike said referring to other clients. He also noted that Quintiles is continuing to compete for preferred provider partnerships.

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