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RALEIGH – PRA Health Sciences on Wednesday morning reported financial results that exceeded Wall Street expectations – then revealed that it was acquired in a $ 12 billion deal by Ireland-based ICON. As a result, Raleigh will lose a head office.
The combined ICON-PRA company will be based in Dublin.
And ICON is paying a hefty price – the trade is valued at 30% of PRA’s share price before the announcement. The deal is expected to close in the third quarter of this year.
Shares of PRA (Nasdaq: PRAH) climbed more than 20% on the news to $ 154. The company has 17,000 employees worldwide. The company moved its headquarters to Raleigh in 2008 (the current location is on Parklake Avenue near the Crabtree Valley Mall) and has around 600 employees in Raleigh, according to the Triangle Book of Lists.
Colin Shannon, President and CEO of PRA, will join the board of directors of the combined company once the transaction is completed.
ICON, which has some 19,000 employees, and PRA were competitors in the global life sciences industry, known as contract research organizations or CROs.
The Triangle is a hub for the CRO industry, a home or site for major operations for companies such as Syneos Health, IQVIA, LabCorp, Parexel and PPD.
Steve Cutler, CEO of ICON, will lead the combined company.
In the announcement, Shannon explained the reasoning for the deal:
“I joined PRA 13 years ago to help build a business that would make a difference in the world and transform the way we developed new medicines. The way we do it now is taking way too long and costing way too much. Critically ill patients cannot wait for recovery. Underserved populations cannot wait for access. Every day counts. COVID-19 has created a platform for change that we cannot ignore. The pandemic has accelerated the adoption of mobile health technologies and healthcare intelligence tools – tools that PRA has helped develop – at an unprecedented rate. The union of PRA and ICON will create an organization that has the people, data and technology to bring these remedies to patients faster and more efficiently than ever. We are delighted to join ICON, a company with a similar culture and values. I am deeply indebted to the 19,000 talented employees of PRA who helped us bring this vision closer to reality. We are united now because patients cannot wait.
PRA shareholders will receive $ 80 in cash and 0.4125 shares of ICON.
ICON trades on Nasdaq under the symbol ICLR. Shares of ICON fell about 7% to $ 195 on the news.
“The combined company will create a new paradigm for accelerating clinical research and bringing new drugs and devices to market,” said ICON CEO Cutler.
“ICON and PRA have a track record of robust growth and performance and we are ready to build on this unparalleled position of strength, utilizing the exceptional talents of both organizations. With a larger and deeper operational scale combined with innovative technology and real data solutions, we will enable all of our customers to reduce their development time and costs. We will be the leading provider of decentralized and hybrid testing solutions through the integration of our data capabilities, healthcare platforms and the Accellacare network of sites. The transaction will be very profitable from year 1 after closing. “
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