Piramal Healthcare to Acquire Decision Resources Group for $635M

Piramal Healthcare, a Mumbai-based pharmaceuticals company, has agreed to acquire the Burlington, Mass.-based healthcare data provider Decision Resources Group from Providence Equity Partners for approximately $635 million.


Piramal Healthcare Limited, an innovation led company, has agreed to acquire Decision Resources Group a US based company in the healthcare information segment, from Providence Equity Partners for a consideration of approximately US$635 million (~Rs. 3,400 crores).

Decision Resources Group provides high-quality, web-enabled research, predictive analytics via proprietary databases and consulting services to the global healthcare industry. With 20% CAGR for the last five years, it is one of the fastest growing companies in the US$5.7 billion global healthcare information industry. DRG projects revenues of US$160 million for 2012. Forty eight of the top 50 global pharmaceutical companies are its customers and it has an overall customer retention rate of 95%.

DRG is focused on three market segments: (1) the Biopharma business unit provides reports, databases and advisory services on drug utilization trends and forecasting in a variety of therapeutic areas; (2) the Market Access business provides database and analytical services that healthcare companies use to assess the current and future opportunity of their products’ acceptance into a market; and (3) the Medical Technology business provides actionable insights and data on the medical device markets. DRG’s products include detailed market assessments based on a specialized network of over 125,000 healthcare professionals (primarily physicians), proprietary databases of market information and detailed analytical reports on specific therapeutic areas.

The three market segments that DRG covers are worth approximately US$2.5 billion, leaving considerable room for DRG to continue to grow its revenues.

After the sale of its healthcare solutions business to Abbott Laboratories in May 2010 for US$3.8 billion, Piramal Healthcare has embarked on a strategy to acquire global growth businesses with sustainable returns. Commenting on the DRG acquisition, Ajay Piramal, Chairman of Piramal Healthcare said, “The global healthcare industry is facing several challenges including rising research costs, lower drug approval rates, mounting regulatory pressures and increasingly complex reimbursement models. The need for specialist information is critical and the demand is growing. DRG’s portfolio of products is widely regarded as the gold standard of information. We will leverage our longstanding reputation and relationships with global pharma companies, our knowledge of emerging markets as well as our track record of successful acquisitions as we continue to grow further DRG’s leadership position in the healthcare information and analytics industry.”

Mr. Piramal added, “We’re very pleased to add the expertise of a world-class management team with deep understanding of this sector and nearly 300 analysts with a strong track record in their field.”

“This is an excellent opportunity for our business, customers and employees,” said Peter Hoenigsberg, Chief Executive Officer of Decision Resources Group. “My team and I are excited to be part of the Piramal Group and are confident that its expertise in acquiring, integrating and growing businesses will support our continued growth. Our customers have indicated that independent, objective, indispensable information from emerging markets is one of their greatest needs and Piramal’s experience in emerging markets is important since these markets are the primary avenues for growth in the pharma industry. We appreciate Providence’s tremendous partnership over the last five years as together we expanded through seven strategic acquisitions and strong organic growth, introduced new innovative services including Market Access Tracker, and added approximately 200 employees worldwide.”

Following the completion of the DRG acquisition, Piramal will operate Decision Resources Group as a stand-alone business. DRG will remain headquartered in Burlington, MA. The company will continue to be led by Mr. Hoenigsberg and the existing senior management team. The transaction is expected to close by June 30, 2012, subject to customary regulatory approvals and closing conditions.

Barclays is acting as lead financial advisor to Decision Resources Group with Oppenheimer & Co. acting as co-advisor, and Weil Gotshal & Manges, LLP is acting as Decision Resources Group’s legal advisor.

Note to editors:

— Information management companies, such as DRG, have exceeded the growth rate of the industries they serve by considerable margins, as companies need their services to compete more effectively.

— DRG uses proprietary databases and a network of over 125,000 healthcare professionals and has over 290 highly qualified analysts putting together its products.

— DRG has a customer retention rate of 95% and customer satisfaction scores that are higher than its competitors.

— Two hundred ninety of DRG’s 500 employees are analysts with deep expertise in specific markets. 140 of the analysts are Ph.D’s, MD’s or Masters graduates. The average retention rate of analysts is 88%.

About Piramal Healthcare Ltd
Piramal Healthcare, is an innovation led company with a growth track record of above 25% CAGR since 1988. Piramal Healthcare had consolidated revenues of US$450million in FY2012. With assets across North America, Europe and Asia, Piramal Healthcare is one of the largest pharmaceutical custom manufacturing companies across the world. It has significant presence in the global critical care space with sales of anesthesia products to over 100 countries. Piramal Healthcare has a robust pipeline of 16 new molecules with its cartilage repair gel — BST-CarGel having received European CE mark approval recently. In 2010, Piramal Healthcare sold its domestic formulation business to Abbott for a consideration of US$3.8 billion. Piramal Healthcare also has a growing presence in the financial services sector with an NBFC focusing on lending to the real estate sector and IndiaReit — a real estate focused private equity fund.

About Decision Resources Group
Decision Resources Group is a cohesive portfolio of companies that offers best in class, high-value information and insights on important sectors of the healthcare industry. Clients rely on this analysis and data to make informed decisions. Please visit DRG at www.DecisionResourcesGroup.com .

About Providence Equity Partners
Providence Equity Partners is the leading global private equity firm specializing in equity investments in media, communications, education, and information companies around the world. The principals of Providence manage funds with over US$23 billion in equity commitments and have invested in more than 100 companies operating in over 20 countries since the firm’s inception in 1989. Significant existing and prior investments include ABTL (Indus Towers), Altegrity, AutoTrader.com, Blackboard, Bresnan Communications, The Chernin Group, Com Hem, Digiturk, Education Management Corporation, eircom, Hulu, ikaSystems, Idea Cellular, Kabel Deutschland, NEW Asurion, Nextag, PanAmSat, ProSiebenSat.1, iQiyi, Study Group, TDC, TVB, UFO Moviez, Univision, VoiceStream Wireless, Warner Music Group, World Triathlon Corporation, Trilogy International Partners and Yankees Entertainment and Sports Network. Providence is headquartered in Providence, RI (USA) and also has offices in New York, London, Hong Kong, Beijing, and New Delhi.