May 3, 2023

Zydus Group is reportedly exploring the sale of its clinical research unit, Cliantha Research, with a price tag of $200m to $250m. Investment bank Moelis & Co. has been hired to manage the sale process, with private equity investors approached. Cliantha specializes in early-phase clinical studies, and also offers other services such as late-phase research and dermatology research. Despite the potential for clinical research in India, the sector has faced challenges including delays in the approval process and insufficient infrastructure. Mumbai: Zydus Group is exploring the sale of its clinical research business, Cliantha Research Ltd, in a deal that could potentially fetch more than $200 million, three people familiar with the development said. The Zydus family is seeking a price of between $200 million and $250 million for Cliantha Research, the people cited above said, requesting anonymity. Investment bank Moelis & Co. has been hired by the Zydus promoters to manage the sale process, and several private equity investors have been approached for a potential deal, the people said. Zydus promoters Pankaj Patel and his family independently own Cliantha Research. The company is, however, not part of the publicly traded Zydus Life Sciences Ltd. Neither the spokesperson for Moelis nor the office of Pankaj Patel, the chairman of Zydus Lifesciences, who is also a promoter at Cliantha Research, responded to requests for comment. Cliantha Research’s net sales rose 57% to ₹499.1 crore for the year ended 31 March 2022 from ₹317.1 crore in the previous fiscal year. Operating profit surged 79% to about ₹145 crore from ₹81 crore, according to data platform VCCEdge, which is owned by HT Media, the publisher of Mint. “Clinical research in India is a challenging business due to regulatory reasons, but this could potentially develop into a platform for a global business," one of the people cited above said. Despite its potential, clinical research in India has faced several challenges, including delays in the approval process, misinformation about trials and insufficient infrastructure, hampering the sector’s development. Clinical research organizations, or CROs, conduct studies and manage drug trials for pharmaceutical companies, with some also providing manufacturing services. Established in 2004, Cliantha specializes in early-phase (bioavailability/bioequivalence) clinical studies, which compare the efficacy of two different drug formulations. The company also offers a range of other services, including first-in-man, late-phase research, respiratory, tobacco, dermatology, and consumer research, according to its website. In November 2022, the Cliantha board approved a buyback proposal of up to ₹40 crore, according to regulatory filings. In 2005, Cliantha acquired Karmic Life Sciences, a company offering clinical trial management, clinical data management, and biostatistics services. Cliantha has offices in the US, Canada, in addition to Ahmedabad, Vadodara, and Noida in India, according to its website. In a similar transaction, Goldman Sachs bought a significant minority stake in Aragen Life Sciences in 2021. ABOUT THE AUTHOR