Patheon shoots for a $100M IPO after $2.6B PE deal

Patheon, snapped up by private equity in a $2.6 billion merger last year, is already plotting a path back to the public markets, filing for a $100 million U.S. IPO.

The company, which handles contract drug development and manufacturing, became part of the conglomerate DPx when private equity magnate JLL Partners struck a deal with Royal DSM to combine it with the latter's eponymous pharma service provider. Now ownership believes the time is right to cash out, betting Patheon's brightest future will come from a return to independence.

Patheon's filing doesn't specify a number of shares to be offered, an expected price range or even a target exchange, saying only that the company plans to trade as "PTHN." The $100 million figure is also likely just a placeholder, and the final size of Patheon's IPO could well be much larger.

The company has grown rapidly since 2011, when former Biogen ($BIIB) CEO James Mullen took the helm, striking a string of acquisitions headlined by its $255 million deal for softgel specialist Banner Pharmacaps in 2012. From fiscal 2011 to fiscal 2014, Patheon's revenue jumped by nearly 250%, the company said, and the contractor now employs more than 8,700 people in 11 countries.

Patheon's short stint as a private firm follows a trend among companies that make money by doing heavy lifting for Big Pharma. Recognizing a growing opportunity, private equity outfits are increasingly buying up CROs and CMOs, merging them with one another and then reaping huge windfalls by taking them public. Over the past few years, similar moves have landed Quintiles ($Q), Catalent ($CTLT) and PRA Health Sciences ($PRAH) on the public markets.

- read the filing

Suggested Articles

Dubbed “Project Nightingale,” the efforts were announced amid concerns and federal inquiries into the data’s safekeeping and patient consent for use.

Independent site management organization Panthera Biopartners has kick-started its first clinical trial in the U.K.

WIRB-Copernicus Group’s clinical services division bought out trial consultancy firm Waife & Associates as it looks to boost its management services.