Healthcare Business

PPD Proves Optimistic in IPO Debut

PPD Inc. (NASDAQ: PPD) made an exciting entrance to the market Thursday. The company priced its shares at $27 apiece, at the high end of the expected price range of $24 to $27. However, the stock actually entered the market around $30. The company sold 60.0 million shares in the offering, with an overallotment option for an additional 9.0 million shares. At the $27 price, the entire offering is valued up to $1.86 billion.

The underwriters for the offering are Barclays, JPMorgan, Morgan Stanley, Goldman Sachs, Merrill Lynch, Credit Suisse, Jefferies, UBS Investment Bank, Citigroup, Deutsche Bank, Evercore ISI, HSBC, Mizuho, Baird, William Blair and Drexel Hamilton.

PPD is a leading provider of drug development services to the biopharmaceutical industry, focused on helping its customers bring new medicines to patients around the world. What many might not remember is that PPD has been in the drug development services business for more than 30 years, providing a comprehensive suite of clinical development and laboratory services to pharmaceutical, biotechnology, medical device and government organizations, as well as other industry participants.

In 2018, PPD served all the top 50 biopharmaceutical companies in the world, as ranked by 2018 research and development spending, and it was involved in 66 drug approvals. Since 2014, this firm has also worked with over 300 companies in the growing biotechnology industry through its PPD Biotech model, which was built specifically to serve the unique needs of this customer segment.

In the filing, the firm detailed its finances as follows:

  • Increased direct revenue from $2,073.5 million for 2015 to $2,837.8 million for 2018, representing a compound annual growth rate (“CAGR”) of 11.0%.
  • Increased net income attributable to common stockholders of PPD, Inc. from a net loss of $(146.6) million for 2015 to net income of $119.9 million for 2018.
  • Increased Adjusted EBITDA from $531.2 million for 2015 to $739.8 million for 2018, representing a CAGR of 11.7%.

PPD intends to use the net proceeds from this offering to pay down its debt, as well as for working capital and general corporate purposes.

Shares of PPD were last seen at $30.01, in a range of $29.80 to $31.54 on the day thus far. Also, about 16 million shares had moved as of 12:35 p.m. Eastern.