French 3-D and product lifecycle management specialist Dassault Systèmes has acquired Medidata Solutions, a provider of SaaS-based clinical development software, for $5.8 billion.

WHAT HAPPENED

Dassault said it had acquired the New York-based company, which posted a profit of $636 million last year, in an all-cash transaction at a price of $92.25 per share for Medidata, for a total of $5.8 billion.

The deal was unanimously approved by the Boards of Directors of both companies and completion of the acquisition is expected during the last quarter of the year.

WHY IT MATTERS

Medidata’s cloud-based services help with the development of therapeutic innovations and clinical operations performance for pharmaceutical companies and biotechnology firms, contract research organizations, and medical centers and sites.

Medidata’s software analyzes pharmaceutical and biotech trials for global drugmakers like Pfizer, AstraZeneca and Sanofi, with the aim of lowering the total cost of clinical development by optimizing clinical trials from concept to conclusion.

The company claims 18 of the top 25 pharmaceutical companies and nine of the top 10 contract research organizations as customers, noting 13 of the top 15 drugs sold in 2018 were powered by Medidata’s technology.

ON THE RECORD

“Facilitating new therapeutic innovations to become the next standards of care has been our commitment since day one,” Glen de Vries, co-founder and president of Medidata, said in a statement. “Ultimately, we will unlock enormous opportunities for our customers and patients, advancing life sciences in the age of precision medicine.”

THE LARGER TREND

The acquisition comes as more and more major technology vendors are making moves into bioinformatics and precision medicine, while increasingly being tasked with incorporating more data into product and service lifecycles.

“It’s a logical evolution of the scope of what we do,” Bernard Charles, chairman and CEO of Dassault Systemes, said in a Wednesday interview on CNBC. “Life science is going to go through an accelerated digitization of its own processes, basically. That’s the motivation for Dassault Systemes to buy Medidata Solutions.”

Dassault already partners with medical device manufacturers, biopharma and biotechnology research institutes, and governmental regulatory agencies to develop health products.

“It’s about the diversification of their business,” Matthew Holt, managing director at private equity firm New Mountain Capital, told CNBC. “They understand regulated markets already, so life sciences wouldn’t spook them.”

In May, Medidata launched Acorn AI, a platform aimed at making data readily available across the end-to-end lifecycle of a pharmaceutical and life sciences company, from research all the way to development and into post-market.

The platform is backed by data from the company’s 17,000 clinical trials and 45 billion patient records from 2 million providers, as well as Medidata’s years of investment in data pipelines and data science.

In February, Medidata subsidiary Shyft Analytics, announced the expansion of the real-world evidence components of real-world data analytics products designed for the pharmaceutical, biotech and medical device industry.

Nathan Eddy is a healthcare and technology freelancer based in Berlin.

Email the writer: nathaneddy@gmail.com

Twitter: @dropdeaded209