By Sabrina Valle
NEW YORK (Reuters) -Private equity firm THL Partners has agreed to buy a majority stake in Headlands Research, a U.S.-based network of clinical trial sites, from KKR in a deal valued at about $600 million, according to people familiar with the matter.
The transaction could be announced as soon as Thursday, the sources said.
Clinical trial sites are experiencing steady business growth as pharmaceutical companies ramp up research spending, driven by new types of therapies and the growing healthcare needs of an aging population.
Private equity firms have stepped up their involvement in clinical trials, drawn by the potential to leverage technology to scale operations and consolidate a fragmented network of stand-alone sites into more integrated and valuable platforms.
THL has been active in pharma services for more than two decades, with past investments including Syneos Health, PCI Pharma Services, Adare Pharma Solutions, and Red Nucleus.
The transaction marks an exit for private equity firm KKR, which acquired Headlands in 2018 and is said to have at least doubled its investment, according to a person familiar with the matter.
KKR’s exit in Headlands followed its successful $12 billion divestment of PRA Health Sciences, a clinical research organization where it delivered a sixfold return for investors.
Recent deals by private equity firms in clinical trials include BayPine’s $1.5 billion acquisition of CenExel, and Genstar Capital’s majority investment in Flourish Research, for an undisclosed amount.
AI is accelerating drug discovery and development, and private equity firms are betting that faster approvals of new therapies will boost demand for clinical trials.
Headlands operates more than 20 sites and has conducted over 5,000 trials in therapeutic areas including central nervous system disorders, mental health, vaccines, and metabolic diseases.
(Reporting by Sabrina Valle in New York; Editing by Dawn Kopecki and Sherry Jacob-Phillips)
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