KBS - Pharmaceutical Consultancy and Life Sciences - Market Insight

STRATEGIC INTERESTS OF PRIVATE EQUITY AND INVESTMENT BUYERS IN THIS SECTOR

Private equity and investment buyers have several strategic interests in the UK pharmaceutical consultancy and life sciences industry:

Recession Resistance: The life sciences sector is known for its relative resilience during economic downturns, which makes it an attractive target for private equity investments.

Predictable Revenue Streams: Companies in contract research (CRO), contract manufacturing (CDMO), speciality packaging, distribution and consulting offer predictable and forecastable revenue streams.

Buy and Build: Many private equity firms use a ‘buy and build’ strategy. This involves acquiring smaller, strategic companies and integrating them to achieve growth. Innovation and Development: Investment buyers are driven by the opportunity for innovation and tackling major health challenges. They see potential in the development of new treatments and technologies, reinforcing the UK’s position as a leader in global healthcare.

Government Support: The UK government has shown substantial support for the life sciences sector, making it a favourable environment for investors.

Strong Foundations: The UK’s strong universities, research base and the NHS provide a solid foundation for biotech and life sciences companies, making them appealing investment targets.

Overall, investors are attracted by the potential for growth, innovation and stable returns in the UK life sciences and pharmaceutical consultancy sector.

Within the UK pharmaceutical consultancy and life sciences services sector, EBITDA multiples have typically ranged between 9x and 14x