Pharmaceutics International (PII), a contract development and manufacturing organization (CDMO) for drug developers, plans to launch a sale process in about 12 months, according to John Fowler, CEO.

The company, which is profitable, expects to generate around USD 49m in 2023 revenue, a number that is expected to rise to USD 65m to USD 70m in 2024, Fowler predicted. That’s up from USD 28m in 2022 revenue, he said.

Hunt Valley, Maryland-based PII was founded in 1994 and brought in private equity investors in 2016, Fowler said. The PE owners, which include Athyrium Capital, Hildred Capital, Signet Healthcare Partners and others, are now looking for an exit, the CEO said.

The company is using Piper Sandler to advise on the potential sale, said Fowler in an interview.

“We are probably going to start a process in about a year for a recapitalization or to sell the company,” said Fowler. “It’s long in the cycle for PE, so it’s time.” He said the company will target both strategics and private equity firms as potential buyers.

PII offers a wide range of analytical and development services to pharmaceutical companies but is focused in particular on contract development of early-stage drugs, proteins and biologics, a factor that Fowler said could make the company an attractive acquisition target for strategics and larger CDMOs, including private equity-backed companies.

He named Baxter International [NYSE:BAX] as a potential buyer along with large PE firms like Warburg Pincus and Advent International, both of which have CDMO portfolio companies that could be interested in PII. Warburg Pincus and Advent, for instance, jointly invested USD 4.25bn to buy Simtra BioPharma Solutions, a CDMO which was spun out of Baxter in 2023, according to a press release.

“There are many big commercial CDMOs, but they don’t have the flexibility to do early development,” said Fowler. “They can use us as a development arm to feed the pipeline.”

Fowler said the company, while fast growing, is still too small to publicly list its shares in an initial public offering, so it won’t take that route.

The company has worked on development of over 30 products that are now approved by regulators, including five in 2023, said Fowler. Oncology treatments made up about 30% of those products, he said.