Kohlberg and Mubadala Buy Majority Stake in PCI Pharma Services

PCI Pharma Services, a pharmaceutical and biopharmaceutical global supply chain solutions provider, and portfolio company of Partners Group, signed a definitive agreement for the acquisition of a majority stake in the company by Kohlberg & Company, LLC.

Kohlberg is a private equity firm headquartered in Mount Kisco, NY with over 30 years of experience partnering with management and companies like PCI Pharma Services. Mubadala Investment Company, an Abu Dhabi-based sovereign investor, will also become a significant investor in PCI.

Partners Group, the global private markets investment manager, has agreed to the sale of its majority equity stake in PCI Pharma Services on behalf of its clients and alongside its investment partners Thomas H. Lee Partners and Frazier Healthcare Partners. Following the sale to private equity firm Kohlberg and Mubadala, Partners Group will retain a minority equity stake in the company. The terms of the transaction were not disclosed.

Headquartered in Philadelphia, PA, PCI Pharma Services provides a broad range of integrated pharmaceutical supply chain solutions from the earliest stages of drug development through to commercial launch, and delivering ongoing supply with global capabilities for drug development and manufacturing, clinical trials services and commercial packaging services. PCI spans a global footprint of 25 GMP facilities across six countries and employs ~3,900 people worldwide.

“Our teams at PCI have embarked on a purposeful journey over recent years to transform the company by executing a successful growth strategy, providing customers with innovative and integrated supply chain solutions and delivering the industry-leading customer experience by differentiating through investment in global capabilities, operational excellence, technology and our biggest asset, our talented people,” said Salim Haffar, chief executive officer, PCI. “I am grateful for the support of our board and the director representatives from Partners Group, THL and Frazier.

“Kohlberg brings considerable successful experience in the biopharmaceuticals and medical device areas, and I am thrilled to be continuing with them to accelerate the growth of our commercial, clinical trial services, and development manufacturing businesses under this new alliance. Both Kohlberg and Mubadala’s experience and track record in supporting successful management teams will make a great impact on PCI’s continued journey of transformation as we focus on building capabilities to support the future demands of our biopharmaceutical customers in our shared goal of bringing life changing therapies to patients worldwide.”

Chris Anderson, partner of Kohlberg, said, "We identified PCI through our Outsourced Pharmaceutical Services White Paper, and our larger industry practice in Pharmaceutical and Medical Products & Services, as a best-in-class company led by a premier management team. We are honored to have the opportunity to work with Salim and his team on their next phase of transformational growth and value creation."

Kohlberg and Mubadala plan to partner with PCI's management team to continue the company's transformation journey by adding specific capabilities and geographies organically and inorganically to improve its customer service experience and enable its customers to bring life-changing biopharmaceutical therapies to market. Leveraging the global growth trends in biologics and specialized drug therapies, future capabilities include sterile fill finish of injectables, expanding high potent and specialized manufacturing and further geographic expansion into Asia and greater Europe.

“We are thrilled to be partnering with PCI's world class management team, and we believe the partnership of Kohlberg, Mubadala and Partners Group is an optimal combination to support management's acceleration of its growth and value creation pathways," said Matt Jennings, operating partner of Kohlberg and future chairman of PCI. "Salim's inspirational leadership, clear vision for the future and focus on expanding customer experience gave us confidence in him, his management team and the long-term future potential for the PCI business.”