Last December, Australian CRO Novotech and Shanghai-based PPC Group unveiled a strategic partnership that created an integrated management structure. Now, it appears the arrangement was just a prelude to a merger.
Novotech and PPC, both majority-owned by private investment shop TPG Capital Asia, will come together to form Novotech Health Holdings, the companies said Monday. The merger will create the largest full-service CRO by the number of employees—about 1,550—focused on biotech in Asia, according to the firm.
John Moller, CEO of Novotech, will serve as the new company’s helmsman, while PPC CEO Michael Stibilj will become chief operating officer.
The two CROs’ platforms are complementary, Novotech has a long history of helping international biotechs into the Asia-Pacific region, while PPC’s clientele is mainly based in China, Moller said in an email interview. The company hopes putting them together will increase its competitive edge in the booming Asia market.
“In light of international clients’ growing interest in Chinese delivery, the merger also enables us to deliver a seamless regional platform ... to meet the significant and growing biotech demand in the Asia market, particularly in China,” Moller said. “Biotech companies in China are also expanding their investment in multiregional clinical trials to accelerate product development. PPC will in turn, also be able to tap into Novotech’s expanded network to offer customers even more.”
Increasingly more biotech-led clinical trials are being carried out in Asia. While global biotech clinical research activity has increased by 10% annually over the past few years, in Asia, the growth rate has been trending at over 25%, according to recent research by Novotech and GlobalData.
Still, PPC gets to keep its name, as Novotech and PPC will still be operating as two separate brands but under the same roof. The reason for not completely folding the two into one is that both have established reputations accrued over 20 years in their respective markets, Moller explained.
“In the near term, our goal is to ensure that the ongoing integration of Novotech and PPC is implemented as smoothly as possible, so that we can create a seamless service for our customers no matter whether they are collaborating with PPC or Novotech,” he said. “We have put in place an overarching governance structure and will continue to make progress on the integration and alignment of our IT systems, SOPs, and quality processes.”