Week of May 15, 2017 | Vol. 6, Issue 18
In This Issue
Featured Headlines
Recent Industry Transactions
Industry Trading Comps
Recent Industry Headlines

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Complete Transaction Tables
Full Trading Comp Analysis

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Contact Information
Jeremy C. Johnson
Managing Director
Pharma & Consumer Health
jjohnson@bourne-partners.com

Xan Smith
Managing Director
Business Development
xsmith@bourne-partners.com
INDUSTRY M&A SNAPSHOT

Above is an overview of recent industry M&A activity. For additional information, see the charts below or follow the link to the left to download complete transaction tables broken out by industry subsectors.

See below for additional information about industry trading comps and transaction relevant articles from the past week.
Teva, still searching for 'world-class' CEO, officially puts women's health, cancer on the block
The company plans to shop its women's health and European oncology and pain businesses to potential buyers, hoping to snag some cash to pay down its debt, management confirmed Thursday.

As interim CEO Yitzhak Peterburg told investors on the company's first-quarter conference call, Teva expects the sale processes to "commence in the coming weeks," and the Israeli drugmaker thinks it can close out both transactions by the end of the year.  Proceeds from those sales-as well as additional asset sales to come-will be "significantly in excess" of the $1 billion Teva previously predicted, Peterburg forecast. Reports that Teva was weighing its options for both businesses emerged after Peterburg said Teva would take stock of its assets. The company issued that announcement in February alongside news of then-CEO Erez Vigodman's departure. Since then, some analysts have questioned the company's decision to make strategic moves before landing a new skipper, with RBC Capital Markets' Randall Stanicky wondering how they would "help recruit a top global executive."  Fear not, though, said Celgene vet Sol Barer, who stepped into the chairman's role when Peterburg moved over to interim chief. Peterburg "has the full support of the board to drive forward on Teva's strategies and key priorities," Barer said on the call. And in the meantime, he said, the CEO search "is moving along very well," with the company already having interviewed "a number of excellent candidates from all over the world."  "We are extremely encouraged by the talent and overall qualifications of the pharmaceutical executives we are meeting with," Barer said, noting that it will still take some time for Teva to decide on the best "world-class individual." When it does, though, Teva will "do what it takes" to bring the candidate to the company, Barer promised-even if it means letting him or her out of the company's previous requirement that a CEO reside in its home country.

Continue Reading at  Fierce Pharma
INC Research, InVentiv Health to Combine in All-Stock Deal
Transaction aims to create large biopharmaceutical outsourcing provider

INC Research  INCR 2.23% Holdings Inc. has reached an agreement to combine with private-equity owned inVentiv Health, creating a large biopharmaceutical outsourcing provider the companies hope will better capture growing demand for outsourced services.  The all-stock transaction, based on the closing price of INC Research common stock Tuesday, values inVentiv at $4.6 billion including debt and gives the combined company a value of about $7.4 billion. INC Research shareholders will own 53% of the combined firm, and inVentiv shareholders are slated to hold 47%.  INC shares, inactive in premarket trading Wednesday, closed Tuesday at $43.65. INC Research had a market capitalization of roughly $2.4 billion.  Raleigh, NC-based INC Research is a contract research company that provides clinical development services for biopharmaceutical and medical-device industries.  Advent International and Thomas H. Lee Partners, two private-equity firms, are equal equity owners of inVentiv and will remain investors in the combined company after the transaction.  The firms said Wednesday that the merger would capitalize on a trend of increased commercial outsourcing while taking advantage of potential cost synergies. The transaction is estimated to deliver about $100 million in annual synergies, which the companies expect to be fully realized in three years.

C ontinue Reading at  Wall Street Journal.

Below are summaries and charts with the past week's transactions from the different healthcare sectors. For a detailed table showing data for each industry transaction click on any of the charts or use the download link above. Total transaction values are provided in USD millions.



 Pharma & Biotech
 11 transactions totaling $881  million
 Supplies, Equipment & Services
 22 transactions totaling $515 million
 Healthcare IT & Managed Care
 4 transactions totaling $78 million
 Healthcare Facilities & Distributors
 13 transactions totaling $1,028 million





Pharma & Biotech
17 private placements totaling $102 million
Supplies, Equipment & Services
11 private placements totaling $517 million
Healthcare IT & Managed Care
7 private placements totaling $246 million
Healthcare Facilities & Distributors
0 private placements


 Pharma & Biotech
 16 public offerings totaling $559 million
 Supplies, Equipment & Services
 10 public offerings totaling $5,000 million
 Healthcare IT & Managed Care
 0 public offerings
 Healthcare Facilities & Distributors
 2 public offerings totaling $1,209 million

Each week, w e provide updated trading  comps for leading comp anies from numerous healthcare subsectors.

To the right you will see a high-level breakdown of median revenue and EBITDA multiples for each of the specific subsectors 

For a complete trading comp analysis (including the individual equities that comprise the subsectors), click on the table to the right or use the download link from the top of this newsletter. 

Note: data reflects prior week close.
RECENT INDUSTRY HEADLINESRecentIndustryHeadlines
A Sampling of Relevant Industry Headlines from the Last Week

Below are snippets from relevant industry news articles from the past week. For additional information or the article's complete text, click the headline link to view the original publication.
Parexel International Explores Sale
May 8, 2017 - Wall Street Journal
Drug-research services provider  Parexel International  Corp. is exploring a sale, according to people familiar with the matter.  The company is working with investment bankers to sound out potential buyers, including private-equity firms, some of the people said. As of early Monday afternoon, Parexel had a market value of about $3.5 billion. Should the company be sold, and there is no guarantee that it will, it could fetch upwards of $4 billion using a typical takeover premium.
Parexel is a so-called contract research organization. Such groups, known as CROs, work with drug companies to help them conduct clinical research.  Parexel, based in the Boston area, works with biotech and medical-device companies, in particular, helping them test and market their products. Parexel operates 86 locations and has nearly 20,000 employees, according to its website.
The company has drawn interest from activist investors, including Corvex Management LP, which has built a sizable stake in Parexel, according to a person familiar with the matter. The firm hasn't publicly talked about its investment.

May 9, 2017 - Wall Street Journal
The U.S. Senate on Tuesday voted 57-42, mostly along part lines, to confirm Scott Gottlieb as the new commissioner of the Food and Drug Administration.  Dr. Gottlieb, a veteran health-care investor and physician, is well known to many drug-industry executives. He worked for years as a consultant to companies including GlaxoSmithKline  PLC and  Vertex Pharmaceuticals   Inc.,  spoke frequently at health-care and investor conferences, and wrote hundreds of essays and op-eds, often advocating for the FDA to approve drugs more quickly and loosen regulations on off-label marketing.  He is also steeped in the details of regulatory approval of drugs and medical devices, having previously served as deputy FDA commissioner under the George W. Bush administration. Dr. Gottlieb favors free-market strategies to bring down drug costs, including by increasing the rate of generic-drug approvals at the FDA. He has also questioned the wisdom of allowing U.S. consumers to import brand-name drugs from countries like Canada, where they cost less, in part because of safety concerns-a viewpoint shared by drugmakers.

Shadowed by nearly $30B in debt, Valeant's $50M guidance raise looks pretty paltry, analyst says          
May 9, 2017 - Fierce Pharma
Faced with a crippling pile of debt, Valeant on Tuesday slightly increased its 2017 earnings guidance, one small positive development as it works to rebound from its noted downfall.
The Canadian drugmaker reported first-quarter revenues of $2.11 billion on Tuesday, missing FactSet consensus estimates of $2.19. But the company sees things going well enough to increase its 2017 earnings guidance to between $3.6 and $3.75 billion, slightly increased from a previous range of $3.55 billion to $3.7 billion.  The move triggered a 20% run-up in share price by mid-morning Tuesday, but at least one analyst urged caution. Wells Fargo's David Maris pointed out that "that the $50 million raise is relative to approximately $28.88 billion of total debt."  "Key products and areas such as Xifaxan and [Bausch & Lomb] continue to underperform," Maris continued.  GI med Xifaxan turned in $185 million in first-quarter sales, significantly below Wells Fargo's estimate of $250 million, Maris wrote. At $1.15 billion, eye unit Bausch & Lomb and international revenues slightly beat the firm's expectations of $1.1 billion, but Maris noted that U.S. diversified products sales at $355 million lagged far behind a Wells Fargo estimate of $420 million.
As an international, healthcare-focused merchant bank and financial advisory firm, we provide world-class services and capital to middle-market healthcare companies around the globe.  We aim to keep our clients well-informed of healthcare news and events.  With this additional insight in mind, together, we can recognize trends and opportunities that benefit our clients.  We hope that you will reach out to Bourne Partners to help execute your healthcare operational and transactional needs.  To learn more about our firm, visit our website or utilize the links below to engage with us on social media. 

Sincerely,

The Bourne Partners Team

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