Bryan, Garnier & Co continues aggressive growth story

US investment bank Brocair Partners combines with European growth investment bank Bryan, Garnier & Co

[Paris, New York] — 26 November 2019 – Today, Bryan, Garnier & Co announces that it is joining forces with Brocair Partners.

Brocair Partners will operate under the Bryan, Garnier & Co brand with Managing Partner Gregg Blake joining Bryan, Garnier & Co as a partner focused on healthcare M&A and Brocair’s William Pay as a managing director focused on China and East Asia. Brocair’s team will be fully integrated with Bryan, Garnier & Co’s existing investment banking professionals across its New York, London, Paris, Munich, Stockholm, Oslo, Reykjavik and Palo Alto offices. With a 23 person-strong international healthcare team, Bryan, Garnier & Co’s unmatched European healthcare investment banking business will be augmented with a deeper presence globally.

Brocair has conducted cross-border healthcare M&A transactions in Switzerland, France, Ireland, the UK, Sweden, Germany, India and the US over the past 15 years, and is considered a thought leader in many healthcare subsectors. It recently advised Enköping, Sweden-based Lifco AB (OM:LIFCO B) on its acquisition of certain dental product assets of Physics Forceps, based in Detroit, and advised St. Louis-based Lee Biosolutions on its sale to Medix Biochemica, based in Espoo, Finland.

The combination provides a strong foothold for the firm to expand its leading European Life-Sciences practice in North America and Asia.

Olivier Garnier, Co-founder and Managing Partner of Bryan, Garnier & Co comments: “Bryan, Garnier & Co is an independent partnership that combines highly experienced, entrepreneur-minded investment banking professionals with the services and expertise of a top-tier investment bank. The deep healthcare expertise at Brocair will provide a strong driver to accelerate Bryan, Garnier & Co’s development in the sector.”

“We are very pleased to be teaming up with Bryan, Garnier & Co, to expand our collective footprint” says Gregg Blake, Managing Partner at Brocair Partners. “There are many synergies between our firms with deep coverage in Western Europe and the Nordics, as well as North America and Asia. Joining forces with Bryan, Garnier & Co’s robust healthcare and ECM platform will bring significantly more capabilities to bear for our clients worldwide.”

About Brocair Partners:

Brocair Partners, founded in 2004, provides financial advice to businesses serving the healthcare, wellness, and pharmaceutical industries. Brocair provides mergers & acquisitions, corporate finance, and strategic advisory services to companies worldwide, and has deep expertise in cross-border transactions, with recent completed transactions in Sweden, Finland, Switzerland, France, the UK, Ireland, and India, as well as the United States.

About Bryan, Garnier & Co:

Bryan, Garnier & Co is a European, full-service growth-focused independent investment banking partnership founded in 1996. The firm provides equity research, sales and trading, private and public capital raising as well as M&A services to growth companies and their investors. It focuses on key growth sectors of the economy including Technology, Healthcare, Consumer and Business Services. Bryan, Garnier & Co is a fully registered broker dealer authorized and regulated by the FCA in Europe.

Dental Products Market Analysis – April 2019

Valuations hover at robust levels, while strategic buyers focus on differentiating technologies.

Valuation multiples in the dental products industry are as robust as they have been. This wouldn’t have been evident in December during the market correction, but current public multiples are back to 2017 levels.

Median revenue multiples for public companies are 2.4x and EBITDA multiples are 16.9x. Recent median transaction multiples are 4.4x revenue and 15.2x EBITDA, though these mask significant differences in multiples depending on the market segment within the industry.

Over the past five years our Dental Products Index has risen 148% compared to a 46% increase in the S&P 500.

Acquisition activity in the sector has slowed since a busy summer of 2018, with only six deals announced so far this year, as of April 2019.

Vision Products Market Analysis – September 2018

Vision products companies are consolidating their position in the market with acquisitions of digital software and expansion into emerging markets.

Since mid-2012, Brocair’s international index of publicly-traded vision products companies has been outperforming the S&P 500 index. It has risen 130% compared to a 70% increase in the S&P 500 index. However, our Vision Products index excludes Essilor and Luxottica. Stock performances of these two eyewear giants have been unsatisfying, mainly due to their slowing retail sales, and their impending merger has also had a significant effect.

Median public company multiples are 2.7x revenue, and 13.9x EBITDA. For transactions over the past three years, median revenue multiples are tracking at .5x
and median EBITDA multiples are 15.3x.

Dental Products Industry Perspective – August 2018

Consolidation among dental products majors continues as the industry expects 6.1% annual growth in the professional market, and a 4.5% growth in the oral care consumer market.

The major segmentation of the dental market is among professional consumables, professional dental equipment, consumer oral care, and laboratories.

The global dental consumables market is expected to grow at a 7.1% compound annual growth rate (CAGR), reaching an estimated $41.5 billion by 2023, while the global dental instrument market is set to grow at a 5.9% CAGR over the same period, reaching approximately $6 billion by 2023.¹ In addition, the dental laboratory industry, which produces restorations, is forecasted to reach $43 billion by 2022, growing at a CAGR of 5.8%.² The global consumer oral care market is forecasted to grow by 4.5% annually and reach $54 billion by 2022.³

Consolidation in the dental products market has significantly changed the competitive landscape.

Over the past few years, M&A among the large market players has had a substantial impact on market dynamics. In 2016 Dentsply acquired Sirona, the third largest dental implants maker, for $5.6 billion. In 2018, Danaher Corporation acquired Nobel Biocare for $2.2 billion to strengthen its position as a market leader. In the personal dental care space, Church & Dwight acquired Water Pik for $1 billion in 2017. But the largest transaction in recent years was Zimmer’s acquisition of Biomet for $13.9 billion.

Many of the industry’s largest companies have acquired smaller firms to bolster their product portfolios, expand their geographic coverage, or enter new niches. Consolidation has also helped boost profit margins as it allows companies to spread fixed costs across larger organizations.

CRO Industry Perspective – July 2018

Data analytics and expanding post-marketing surveillance is driving growth.

Contract Research Organizations (CROs) provide R&D services to companies in the biotechnology, pharmaceutical and medical device industries, which outsource R&D activities to access capabilities not found in-house, manage R&D costs and improve efficiencies. According to Grand View Research, the global CRO market is expected to reach $45.2 billion by 2022. Though CROs were initially niche players in clinical research services, full-service CROs today provide a wide range of services that include discovery and preclinical development, clinical trial services, post marketing surveillance, data management and analytics, consulting, and often other commercialization services.

CROs are involved with every step in the drug development process. In the discovery stage, a lead compound is found to have the potential of a new medicine. This lead compound is then tested in preclinical trials, mainly in forms of in-vitro and in-vivo experimentation. In-vitro testing is done in the lab using inanimate research tools, while in-vivo tests are conducted on animals. The discovery and preclinical development market was worth $3.25 billion in 2016¹, representing 16% of the CRO market today. It is expected to grow annually by 8.3% to 2016².

If the lead compound successfully completes its pre-clinical studies, it moves into the clinic and into human subjects. A Phase I clinical trial usually involves a small group of healthy participants and focuses primarily on drug safety and dosage determination. After products are tested for safety, a Phase II trial is conducted to test effectiveness in a slightly larger group of ill patients. After safety and effectiveness have been established, Phase III trials, which are typically much larger studies, compare the safety and effectiveness of the new treatment to other available treatments. After successfully completing Phase III trials, the new product may receive FDA approval. Across the three phases, clinical trial services represent the largest component of the CRO market, worth $25 billion in 2017 and growing 7% annually, according to Beroe, Inc.³

Brocair Advises COLTENE in Acquisition of KENDA

Brocair Partners, a mergers & acquisitions advisor serving the healthcare industry, advised Swiss dental company COLTENE Holding in its acquisition of Liechtenstein-based KENDA

NEW YORK, NY – January 30, 2018 – Brocair Partners, a mergers & acquisitions advisor serving the healthcare industry, advised COLTENE, a SIX Swiss Exchange-listed developer, manufacturer and seller of dental consumables and small equipment in the areas of restoration, endodontics, prosthetics and treatment auxiliaries, on its acquisition of KENDA AG.

KENDA was established in Liechtenstein in 1977 and is a specialized, internationally active manufacturer of silicone polishing instruments for dentistry applications. KENDA manufactures high-precision rotating polishing instruments for dentistry and dental laboratory applications. Its polishers are available as autoclavable versions for multi-patient use and as single-patient polishers for one-time use.

The transaction size was not disclosed.

KENDA’s business will be integrated into COLTENE’s Rotary Instruments product group, expanding the current offering of diamond and carbide burs. COLTENE is enhancing this product group’s portfolio offering, technology know-how and sales flows through this acquisition.

Brocair has an extensive track record advising companies in the dental industry, including completed projects in dental prosthetics, implantology technology, and dental instruments, and is a frequent visitor to major dental trade shows and conferences.

Gregg Blake, Managing Partner of Brocair, explained, “We introduced KENDA to COLTENE, and there was immediate personal chemistry between the leadership of both companies, whose headquarters were only a short distance apart, in eastern Switzerland and Liechtenstein. This acquisition is an outstanding fit from a corporate culture perspective, as well as a smart business combination. This acquisition will complement COLTENE’s global Rotary Instruments business. Combining KENDA’s dental polisher business with COLTENE’s international marketing and sales infrastructure will create opportunities to grow their businesses together in markets around the world.”

About COLTENE:

COLTENE is an internationally active developer, manufacturer and seller of dental consumables and small equipment in the areas of restoration, endodontics, prosthetics and treatment auxiliaries. COLTENE has state‐of‐the‐art production facilities in the USA, Germany, Brazil and Switzerland as well as own distribution organizations in all major markets including China and India. Dentists and dental labs all around the globe trust COLTENE’s high‐quality products. The registered shares of COLTENE Holding AG (CLTN) are listed on SIX Swiss Exchange. Visit COLTENE online at www.coltene.com.

About KENDA:

KENDA, headquartered in Vaduz in Liechtenstein, was established in 1977 and manufactures high-precision rotating polishing instruments for dentistry and dental laboratory applications. Its polishers are available as autoclavable versions for multi-patient use and as single-patient polishers for one-time use. For more information: www.kenda-dental.com.

About Brocair Partners LLC:

Brocair Partners, founded in 2004, provides financial advice to businesses serving the healthcare, wellness, and pharmaceutical industries. We provide mergers & acquisitions, corporate finance, and strategic advisory services to companies worldwide. This transaction and other Brocair transactions can be found here: www.brocair.com.

Healthcare Payer Services Market Analysis – August 2017

Emerging shift from Fee-for-Service care to Value-Based Reimbursement model results in new challenges for the dynamic Healthcare Payer Services Industry

As a direct result of the Medicare Access and CHIP Reauthorization Act of 2015 (MACRA), traditional fee-for-service payments are being replaced with a financial incentive framework that rewards improved quality, outcomes and cost This transition to value-based care creates new challenges in which care providers will now have to emphasize patient outcomes compared to the traditional volume based approach. Recognizing that low-cost services will be fundamental to their success, numerous industry leaders are meeting these challenges by lowering administrative costs and restructuring their practices to deliver more efficient systems to record and foster successful patient outcomes. These regulatory changes have led to an increase in acquisitions that promote a more patient-focused health insurance business model.

Over the past seven years, our Healthcare Payer Services Index has generally tracked the S&P 500 Index. Given the dynamic nature and complexity of changes in the health insurance industry, the companies that have been more active in pursuing inorganic growth have been able to stay ahead of the competition.

The median revenue multiple for public companies in the space has risen to 2.4x vs 1.7x in 2015 while EBITDA multiples have jumped to 14.0x for the last-twelve months, from 11.2x in 2015. Median reported valuation multiples from M&A transactions over the past year are 1.7x revenue and 18x EBITDA, though these are skewed high, since usually only the larger deals report multiples. Smaller transactions would command lower multiples.

Pharma Business Services Market Analysis – July 2017

Outsourced service providers to the pharmaceutical and medical device industry continue to expand their service offerings and geographic presence—and CROs have become buyers.

Valuations in the space continue to rise, with revenue multiples in the public markets currently tracking at a median of 2.7x, and median EBITDA multiples of 15.4x.

Median revenue multiples are 1.7x and median EBITDA multiples are 13.9x for transactions over the past three years. In September 2015 transaction multiples of EBITDA were 9.3x, so valuations have moved significantly higher.

Brocair’s index of pharma business services companies outperformed the S&P 500, and is up approximately 135% in the past five years, versus nearly 100% for the broader index.

M&A activity in the space has continued apace as industry leaders have been trying to consolidate the market share by merging with competitors, and traditional CROs have been moving into complementary services in the space.

Medical Reprocessing Market Analysis – June 2017

Medical reprocessing market sees renewed growth as healthcare providers face pressures to manage costs and increase sustainability

The global medical sterilization, repair, and refurbishment industry is expected to reach $6.93 billion by 2021 from $4.69 billion in 2016, at a CAGR of 8.8%.¹

Our medical reprocessing index has generally tracked the growth of the S&P 500 index since 2012. In the last three years the S&P index has increased 37%, while our medical reprocessing index has increased 45%.

Median revenue multiples in the public markets are currently tracking at a median of 2.1x, while EBITDA multiples have a median of 21.1x, showing stable performance compared to the last year with 1.8x and 19.4x respectively.

Transaction multiples, as are typical, are tracking in a somewhat lower range, with median revenue multiples of 1.7x and median EBITDA multiples of 9.0x over the past three years.

CRO Market Analysis – June 2017

Middle-market CROs continue to consolidate in order to expand their menu of service offerings

Over the past two years, valuations have remained consistently strong in the CRO industry. Since mid-2012 our CRO Index has risen 240% compared to an 85% increase in the S&P 500. Public company multiplies have been tracking at 2.6x revenue and 13.5x EBITDA while recent transactions have been tracking at 3.5x and 12.5x, respectively.

The CRO industry is expected to grow to $45.2 billion by 2020 at a compound annual growth rate of 6%.¹ This growth is being driven both by an increase in venture capital investment in small biotech drug discovery firms and greater focus on research and development by larger pharmaceutical companies.

The largest volume of M&A activity in the CRO space has occurred in the middle market as smaller firms look for opportunities to expand their service offerings both locally and internationally. Consolidation has also been a way for firms to address high customer concentration. Through acquisitions, companies are able to obtain new customers and offer a new breadth of services.

The CRO market has recently become a major target for private equity, such as the acquisition of eResearchTechnology by Nordic Capital in March 2016 for nearly $1.8 billion, and the purchase of BioClinica by Cinven for $1.4 billion in October 2016. Advent International and Thomas H. Lee bought inVentiv Health for $3.8 billion in November 2016, but just six months later, in May 2017, INC Research and inVentiv announced a merger to form the second largest biopharmaceutical outsourcing provider with an enterprise value of $7.4 billion. Advent and Thomas H. Lee remain shareholders.

Although smaller firms have dominated M&A activity, larger strategic players have also made significant acquisitions to gain market share and expand their clinical technology applications. The $13.6 billion acquisition of IMS Health Holdings by Quintiles in October 2016, a provider of biopharmaceutical development and outsourcing, created the largest global CRO and will enhance Quintiles’ offerings through IMS Health’s global information solutions for clients.