eResearchTechnology (Philadelphia, Pennsylvania)
eRT will pay Covance $35.2 million in cash and an additional amount of up to $14 million based on revenues achieved from the backlog transferred and new contracts secured through Covance’s marketing activities. Under the terms of the marketing agreement, Covance will exclusively use eRT as its provider of centralised cardiac safety services for the next ten years and in return will receive certain referral fees.
As a result of the acquisition, eRT is forecasting additional revenues of $1.5-2 million in the fourth quarter, to give a total of $28.5 million. However, diluted earnings per share are expected to drop by 2 cents to 7-9 cents per share for the quarter and to 27-29 cents for the full year due to integration costs. The company expects an additional $18-20 million in revenues from the business in 2008.
Covance says that the ECG business accounted for less than 2% of its annual net revenues. eRT on the other hand specialises in centralised core-diagnostic ECG technology and services to evaluate cardiac safety in clinical development. It also provides technology and services to automate the collection, analysis and distribution of clinical data. “Under the new marketing arrangement, we believe our clients will benefit from eRT's industry-leading centralised ECG services. The transaction also allows Covance’s management team to focus more attention on growing our service offerings in the larger markets we serve,” said Covance chairman and CEO Joe Herring. Article submitted by www.jobs4dd.com, for latest news and jobs in the clinical research and drug development fields.
