OpEx Awards 21: Americas Large-cap winner – Partners Group

Partners Group’s hands-on approach with PCI Pharma Services helped deliver operational efficiencies while strengthening the company’s global footprint

Founded in 2012, PCI Pharma Services provides integrated pharmaceutical development systems. The company offers clinical trial services that include pharmaceutical development, clinical trial manufacturing, clinical packaging and packaging design, primary packaging and secondary packaging services.

Partners Group’s involvement with PCI can be traced back to 2013 when it carried out thematic research tracking the company and its operations. Three years later, the private markets firm acquired a majority stake in the company.

Partners Group set out to transform PCI by prioritising operational efficiency, procurement, global expansion and succession planning. During its investment period, Partners Group introduced a manufacturing excellence tool, which resulted in a meaningful capacity increase.

The firm also hired an external adviser for operational improvement and project governance. This led to systematic improvements in backlog management and substantial savings captured in 2018.

In addition, a value-based pricing initiative was introduced in the company’s commercial segment. Furthermore, a procurement initiative resulted in meaningful savings in 2020 and it is expected to generate further savings into 2021.

Partners Group also made a number of senior hires and internal promotions to strengthen the management team, shifted the company’s strategy to focus on small and mid-sized biopharma customers, and supported PCI’s ESG goals, which centred around minimising energy consumption, reducing waste and landfill, and enhancing health and safety.

Shopping spree

As part of its global expansion efforts, PCI made a number of acquisitions, including Ireland’s Millmount Healthcare in 2017, Australia-based Pharmaceutical Packaging Professionals and California-based Sherpa Clinical Packaging in 2018, and Toronto-based Bellwyck Pharma Services in 2020.

In doing so, the company established its presence in Asia-Pacific and grew its footprint in Western US, Europe and Canada.

15.6%

Increase in EBITDA CAGR

In August 2020, Partners Group announced it had agreed to sell its majority stake in PCI to Kohlberg & Company and Abu Dhabi-based sovereign wealth fund Mubadala Investment Company. The transaction closed in November and Partners Group retains a significant minority stake in the company. Under its ownership, PCI’s EBITDA increased by 15.6 percent CAGR.

The judging panel described Partners Group’s backing of PCI as “an excellent, well-rounded transaction with clear value-add”.

“Partners Group was able to implement its thesis so that it could create a leading global clinical trial services platform targeting small and mid-sized customers, both via organic and inorganic strategies,” one judge said.