UDG Healthcare announced the acquisition of Create NYC and SmartAnalyst for a combined consideration of up to $82.4 million. Both companies are dedicated to the healthcare market.
Create NYC is a New York-based healthcare creative communications agency, offering execution of sales and marketing materials for its international pharmaceutical clients. Create NYC’s offering comprises a unique, disruptive model which gives its clients high impact, on-demand flexible marketing support with a flat fee structure. This approach complements the more traditional agency model.
Founded in 2009 by Natalie McDonald, who remains with the company as CEO, Create NYC employs 43 people in-house. The business will become part of Ashfield Communications.
Create NYC is being acquired for a total consideration of up to $58.4 million, with $17 million paid upfront, and an earn out of up to $41.4 million over five years.
The acquisition of Create NYC is in line with Ashfield’s strategy to expand into areas of differentiated but aligned adjacencies to its core scientific communication capabilities. For Create NYC, Ashfield provides the opportunity to diversify its client base and expand internationally.
For the year ending 31st December 2017, Create NYC had gross assets of $9.1 million, which generated operating profits of approximately $7 million. It is expected to deliver a return on capital employed in excess of the Group’s target of 15% within three years. The transaction completed on 2nd July 2018.
SmartAnalyst is a US-based strategic consulting and analytics business focused on the pharmaceutical and biotech sector. The company was founded in 2001 and has 135 employees based across operations in New York, London and Gurgaon, India. SmartAnalyst provides strategic consulting services to pharmaceutical and biotech companies to support disease, asset, and portfolio level decisions. SmartAnalyst also provides Health Economics and Outcomes Research (HEOR) services, which uses evidence based data and analytics to demonstrate the value of products and to support market access and reimbursement with payors. HEOR is a high growth area, driven by market dynamics such as the increasing complexity of drugs, the changing landscape of market access, cost and regulatory pressures, and the increased scrutiny of real world outcomes.
SmartAnalyst is being acquired for a total consideration of up to $24 million. This includes initial consideration of $18 million, with an earn out of up to $6 million payable over the next three years, based on the achievement of agreed profit targets. The acquisition is expected to deliver a return on capital employed in excess of the Group’s target of 15% within three years. The transaction completed on 29th June 2018.
Both transactions will be financed from existing cash and debt facilities and are expected to be earnings accretive.