To say that things at PRA International have been in flux of late would be an understatement. 

Last September, the publicly traded contract research organization (CRO) moved its headquarters from Reston, Virginia, to Raleigh, North Carolina. Two months later, the three-decade-old company was bought by private equity firm Genstar Capital for $797 million. Its last day as a NASDAQ company was Dec. 13.

A Good Thing

Despite the apparent turbulence, David Dockhorn, the company’s executive vice president of product registration in the Americas, says PRA is in essence returning to its roots. PRA was only public for three years. Before that, it was a private company owned by, well, Genstar.

And the buy-back is a good thing, says Dockhorn. “It will allow us to focus on some more longer term growth strategies,” he explains. “We’re going to be able to focus on some more process re-engineering, making sure we’re dong things more and more efficiently—not so much focused on the quarter-to-quarter public perception that we’ve got out there. This allows us to build and grow and organize in a methodical fashion.”

No Ivory Tower

Why relocate, though? Dockhorn says that just made sense, too. The company had no other operations in Northern Virginia other than its headquarters. In Raleigh, though, PRA has a full-service operations facility.

“It allows executive management to have their finger on the pulse of operations, and not have so much of an ivory-tower view of operations,” says Dockhorn.

Revenue Up, Income Down

Despite all the changes, PRA had decent financial results in 2007. Dockhorn says it had significant year-over-year growth. The company’s last public earnings statement indicated that service revenue increased 23.1 percent to $271.9 million for the first nine months of 2007 (ending Sept. 30).

Profits were down, though: income from operations in the first nine months of 2007 was $14.3 million compared to $26.6 million the previous year. The good news, though? New business increased 25 percent to $479.1 million.

Turnover Reduced

In addition, the company was able to reduce employee turnover—a persistent industry bugaboo—by about 10 percent, says Dockhorn. To do that, it has had to rework its culture a bit.

“We got rid of a lot of processes and procedures and that allowed us to free people up to enjoy their jobs,” he says. “We eliminated a lot of standard operating procedures (SOP) that required our staff to handle a lot of minutia that didn’t make sense. They’re happier now.”

Ancient History

PRA, which had traded as PRAI, began as a tiny operation in the home of a University of Virginia researcher in the late 1970s. The small, data management-focused CRO was initially named the Anti-Inflammatory Drug Study Group (AIDS Group), as it was expected to just pick up work from rheumatology-oriented studies. When more varied work started flooding in, and when the acronym AIDS took on a different meaning, the two co-founders changed the name to Pharmaceutical Research Associates.

The company went full service in 1991, the same year it opened its first office in Europe. Five years later, it began getting aggressive with acquisitions.

Aggressive Gobbling

Between 1996 and 2002, it gobbled up the Kansas-based CRO International Medical and Technical Consultants (where Dockhorn previously worked); Valorum, a CRO in the UK; Arcam, a Paris-based CRO; Staticon International, a CRO in Madrid; and CroMedica, a central nervous system (CNS)-focused CRO in Canada.

On the heels of all that acquiring, PRA went public in 2004 and continued acquiring (Pharma Bio-Research, a lab in the Netherlands; and Pharmacon, a Berlin-based CRO).

Even Split

Currently, PRA has 3,200 employees working on about 500 trials at any given time. Clients range from big pharma to biotechs, split about evenly, says Dockhorn. 

U.S. offices are in Raleigh, N.C.; Charlottesville, Va.; Horsham, Pa., Austin, Texas; Lenexa, Kansas; and San Diego. Internationally, PRA has offices in Victoria, BC, Canada; Buenos Aires, Argentina; Sao Paulo, Brazil; Mechelen, Belgium; Mannheim, Germany; Paris, France; Budapest, Hungary; Madrid, Spain; Warsaw, Poland, Moscow, Russia; and three locations in the Netherlands.

Early Development Focus

Growth, says Dockhorn, is fastest these days in early development work as well as Phase III. PRA has more recently focused its sales on getting more early development work, he says.

Therapeutic areas where the company has been strong are oncology, allergy/respiratory and CNS. Going forward, says Dockhorn, PRA will be placing more emphasis on infectious diseases, as it’s a promising area.

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