Project:

Pharmaceutical Contract Manufacturing: Investment Identification and Valuation

Client

Leading Private Equity Firm, Health Care Division

Description

As part of their long-range growth plan, our client’s objective was to consolidate, either through partnerships or acquisitions, a number of small and mid-size contract manufacturers into a larger organization capable of generating meaningful economies of scale. Investment criteria required that targets have some degree of established manufacturing capacity and the ability to produce pharmaceutical ingredients that could meet the standards of advanced regulatory agencies.

VOI conducted a thorough search to identify firms throughout the world that met the client’s investment criteria. Relying on both interviews and secondary research, we evaluated these companies on a number of criteria including manufacturing capabilities and capacities, customer bases, capital structures and financial conditions. We then developed fair market valuations on the most promising of these firms and worked with our client to conduct due diligence on the ultimate investment targets.

Results

Our client used the results of our analysis to make three investments, including one acquisition (which was merged with a company in the client’s existing investment portfolio) and two equity purchases.

Project

Therapeutic Opportunity Analysis / Licensing Review

Client

R&D-based Biopharmaceutical Firm

Description

VOI reviewed the Congestive Heart Failure (CHF) market for a biotech firm that was deciding whether to follow its normal practice of licensing to a major company or to keep the new product in-house as a means of establishing itself as a full-service company with marketing and other capabilities.

We thoroughly evaluated the potential for this product based on its probability of approval and likelihood of commercial success.

Note: Although this project was specific to the CHF market, we have conducted numerous similar studies for virtually all major and minor therapeutic categories.

Results

Based on our work, our client decided that this product faced too many regulatory and commercial risks to justify a major change in company direction and decided to license the product. Our work served as the basis for product valuation in the licensing negotiations.