PHT, Inc. is a leading global provider of software solutions and services to record and document patient reported outcomes in pharmaceutical clinical trials. PHT was sourced to the BMP team from a close advisor and investor in our partnership who was aware of our expertise in the sector. Through its PAREXEL investment, BMP was well acquainted with the clinical trials services area and the potential for a science and technology based offering to improve trial results and lower drug development costs. BMP led the first institutional investment round in the company and assumed the Chairmanship of the Board of Directors. Soon thereafter we identified and helped negotiate a technology acquisition that brought additional product capability and management depth to the company.
The remote monitoring and data collection business evolved significantly during our investment period. It became apparent that the company’s product offering was ahead of the customers’ readiness to change their business model and implement new technology. Pharmaceutical customers wanted complete flexibility on any hardware choice therefore PHT management continually needed to update its software and develop additional versions for multiple platforms. Managing inventory for many devices became a challenge as well. We assisted the team in evaluating alternatives to owning and selling hardware which eventually improved capital efficiency at the company. As market demand was slow in the early years of our investment a series of management augmentations was required to settle on the best business model and skills sets to meet our customers’ evolving needs. As PHT grew, BMP continued to provide both board leadership and additional capital to fund product line expansion. Augmenting the internal operating capacity as well as systems and infrastructure, and expanding the company’s European efforts, eventually produced substantially improved revenue growth for PHT. Regulatory endorsement and increasing market demand enabled PHT to negotiated long term, multi-million dollar contracts with 18 of the 20 top pharmaceutical companies. To enable the company to continue to provide high levels of service to its customers, BMP worked with senior management to enhance and augment the leadership team and the board of directors.
PHT matured into a market leader and substantial enterprise with 350 employees. BMP was instrumental in negotiating the sale of the company to another significant clinical trials service provider. We identified a banker with whom BMP had a longstanding relationship and were able to complete a successful transaction satisfying all the investors and management. The sale of PHT to eResearch Technology Inc. (NASDAQ: ERT) in 2015 resulted in a 300% return for BMP’s Limited Partners.
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