IPO Report: INC Research Holdings (INCR)

Francis Gaskins |

INC Research Holdings  ($INCR) is a leading global CRO based on revenues and are exclusively focused on Phase I to Phase IV clinical development services for the biopharmaceutical and medical device industries. It is based in Raleigh, NC.

Ten other companies are scheduled for the week of Nov. 3, 2014.  The full IPO calendar is available at IPOpremium.

SEC Documents

Manager, Joint-managers: Goldman Sachs, Credit Suisse, Baird, Wells Fargo Securities, William Blair
Co-managers: None

End of lockup (180 days): Wednesday, May 6, 2015
End of 40-day quiet period: Wednesday, December 17, 2014

INCR scheduled a $150 million IPO with a market capitalization of $915 million at a price range midpoint of $18.50 for Friday, Nov. 7, 2014 on Nasdaq.


INCR is a leading global CRO based on revenues and are exclusively focused on Phase I to Phase IV clinical development services for the biopharmaceutical and medical device industries.



Valuation Ratios

Mrkt Cap (mm)

Price /Net service rev

Price /Erngs

Price /BkVlue

Price /TanBV

% offered in IPO

annuallizing Sept 9 mos, proforma adj income


INC Research Holdings (INCR)







Quintiles Transnational (Q)*







*annualizing June 6 mos



Neutral plus

Top line service rev up 25%

On a proforma basis profitable for Sept 9 mos

Priced at a discount to Q



INCR is a leading global CRO based on revenues and are exclusively focused on Phase I to Phase IV clinical development services for the biopharmaceutical and medical device industries.

INCR provides its customers highly differentiated therapeutic alignment and expertise, with a particular strength in CNS, oncology and other complex diseases. INCR consistently and predictably deliver clinical development services in a complex environment and offer a proprietary, operational approach to clinical trials through its Trusted Process® methodology.

INCR’s service offerings focus on optimizing the development of, and therefore, the commercial potential for, its customers' new biopharmaceutical compounds, enhancing returns on their R&D investments, and reducing their overhead by offering an attractive variable cost alternative to fixed cost, in-house resources.

Over the past decade, INCR has systematically built its scale and capabilities to become a leading global provider of Phase I to Phase IV clinical development services, with approximately 5,500 employees in 50 countries across six continents as of September 30, 2014.

INCR’s broad global reach has enabled it to provide clinical development services in over 100 countries. INCR’s global footprint provides its customers with broad access to diverse markets and patient populations, local regulatory expertise and local market knowledge. INCR has developed its capabilities and infrastructure in parallel with its extensive, industry-leading relationships with principal investigators and clinical research sites, as demonstrated by its ranking as the "Top CRO" in the 2013 CenterWatch Global Investigative Site Relationship Survey, which was conducted by CenterWatch, a third-party leading publisher in the clinical trials industry.

The survey covered responses from over 2,000 global sites across 36 specific relationship attributes about CROs that the sites surveyed have worked with in the past two years.

INCR believes these attributes are critical for delivering high quality clinical trial results on time and on budget for its  customers.

INCR provides robust clinical development services through specialized therapeutic teams that have deep scientific expertise and are strategically aligned with the largest and fastest growing areas of its customers' R&D investments.

Over 75% of INCR’s backlog as of September 30, 2014 is in CNS, oncology and other complex diseases, such as genetic disorders and infectious diseases.

Intellectual property

INCR has obtained or applied for trademarks and copyright protection in the United States and in a number of foreign countries. INCR’s material trademarks include Trusted Process®, PlanActivation, QuickStart, ProgramAccelerate, QualityFinish and INC Research. Although the duration of trademark registrations varies from country to country, trademarks generally may be renewed indefinitely so long as they are in use and/or their registrations are properly maintained, and so long as they have not been found to have become generic.

Although INCR believes the ownership of trademarks is an important factor in its business and that its success does depend in part on the ownership thereof, INCR relies primarily on the innovative skills, technical competence and marketing abilities of its employees.


INCR competes primarily against other full-service CROs and services provided by in-house R&D departments of biopharmaceutical companies, universities and teaching hospitals. Although the CRO industry has experienced increased consolidation over the past three years, the landscape remains fragmented. INCR’s major competitors include Covance, Inc., ICON plc, inVentiv Health, Inc., PAREXEL International Corporation, Pharmaceutical Product Development, LLC, PRA Health Sciences, Quintiles Transnational Holdings Inc. and numerous specialty and regional players.

5% shareholders pre-IPO

Avista   68.3%

OTPP   29%                


No dividends are planned.

Use of proceeds

INCR expects to receive $135 million from its IPO and use it for the following:

to fund the redemption of all of its outstanding Notes and pay related fees and expenses. INCR expects the repayment of its $300 million outstanding aggregate principal amount of Notes, plus redemption premiums, make-whole interest and related fees and expenses, to result in a cash outflow of $336.5 million upon the consummation of this offering. Additionally, in connection with the corporate reorganization and this offering, INCR expects to use $3.4 million of cash on hand to redeem its New Class C Common Stock, $9,000 of cash on hand to redeem its New Series D Common Stock and $3.4 million of cash on hand to terminate its Advisory Services Agreement with Avista.

DISCLOSURE: The views and opinions expressed in this article are those of the authors, and do not represent the views of equities.com. Readers should not consider statements made by the author as formal recommendations and should consult their financial advisor before making any investment decisions. To read our full disclosure, please go to: http://www.equities.com/disclaimer


Symbol Name Price Change % Volume
INCR INC Research Holdings Inc. 43.20 -1.50 -3.36 866,174


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