Precision Medical Group, which helps pharma and life science companies develop and bring new products to market, is up for sale, according to multiple sources familiar with the matter.
Goldman Sachs is advising on the process, with first round bids for the private equity-backed company scheduled for August 24, the people said.
A narrow group of large buyout funds and one strategic are expected to bid, one of the people said.
Precision is marketing adjusted EBITDA of $115 million, sources said. The sellers hope to command an EBITDA multiple of at least 20x, they said, suggesting value expectations of around $2.3 billion.
Boston private equity firm Berkshire Partners intends to remain invested in the company, sources said. In December 2017 Berkshire and TPG Growth co-led a $275 million investment in Precision. The company’s co-founders and management team, as well as previous investors Oak Investment Partners and J.H. Whitney Capital, participated in the funding.
TPG Growth, the mid-market growth equity arm of TPG, first invested in Precision in 2015, injecting $75 million in the company to fuel expansion. J.H. Whitney continues to list Precision as a portfolio company, while Oak Investment Partners’ successor firm Oak HC/FT is no longer invested.
Precision, co-founded in 2012 by Ethan Leder and CEO Mark Clein, encompasses two units: Precision for Medicine and Precision Value & Health.
Precision for Medicine, a precision clinical research and development organization, helps pharma and life science companies accelerate the clinical trial process from early development to regulatory approval.
Precision Value & Health, further down the continuum, helps speed up the drug commercialization process and improve successful product launches through a data-driven approach.
The process for Precision was originally poised to launch in March, but delayed like many processes when covid-19 escalated, fueling market chaos.
Other situations in the pharma outsourcing services universe have restarted after a pause.
Linden Capital Partners in June formally relaunched its sale process for ProPharma Group. The company provides compliance-related consulting services to the life sciences industry. The process is targeting an August signing, PE Hub wrote.
Proving an outperformer through the downturn, Partners Group-backed PCI Pharma Services formally kicked off its sale process in July. Jefferies is conducting the auction, which is likely to produce a deal valued in the $2.5 billion to $3 billion range, sources told PE Hub at the time.
On the medical device outsourcing services front, privately owned NAMSA has yet to trade hands. The company’s Edgemont Partners-run process aimed at PE originally kicked off at the start of the year.
Berkshire, TPG Growth, Precision and Goldman declined to comment. J.H. Whitney did not return requests for comment.
Action Item: Read more about ProPharma Group’s sale process.