Becton Dickinson aims to grow by bringing new technologies to more places across the healthcare spectrum. Pharmacies are now part of this plan. The medical technology giant is to acquire pharmacy automation company Parata Systems in a $1.525 billion deal.
Under terms announced Monday, BD is paying cash to buy Parata, which has marketed robotic systems that sort and package pills, automating much of the repetitive, manual work of pharmacists. Founded in 2001, the Durham, NC-based company markets its technology as a way to free up pharmacists to perform other tasks, make pharmacies more efficient and reduce prescription errors. According to BD, Parata’s revenue for the 12 months ended March 31 was approximately $220 million.
Parata is a portfolio company of investment firm Frazier Healthcare Partners, which entered pharmatech in 2017 with the acquisition from Wisconsin-based pharmaceutical packaging and automation company TCGRx. The next year, TCGRx acquired Parata and the combined company retained the Parata name and Durham head office. Financial terms of the two agreements were not disclosed.
BD has made a name for itself by manufacturing and selling diabetes products. Earlier this year, it completed the spin-off of that business as a separate, publicly traded company, now named Embecta. BD has pursued a growth strategy it calls “BD 2025,” which focuses on adding technologies that are part of connected care or enable care to be delivered in new environments, such as the home. In addition to in-house R&D, the medtech giant is planning additional acquisitions that will add assets to its portfolio that fit its growth strategy.
“Parata has a very attractive financial profile and a compelling value proposition that meets all of our rigorous investment criteria for growth, profitability and return,” said Tom Polen, BD’s Chief Executive Officer and President in a prepared statement. “With the addition of Parata, BD is advancing our 2025 growth strategy around smart, connected care and creating new care environments.”
The Parata acquisition is BD’s largest since it bought surgical products company CR Bard in 2017 for $24 billion. In a research note sent to investors on Monday, William Blair analyst Brian Weinstein wrote that the Parata acquisition gives BD access to a growing $600 million pharmacy automation market. in a context of staff shortages, salary inflation and increased demands faced by pharmacists. He added that the deal aligns with his company’s expectations of what BD should do and is in line with its announced growth strategy for 2025. As part of BD, Parata’s offerings can outpace market growth through the business footprint, global scale and innovation capabilities of the largest company.
The deal still requires regulatory clearances, but the companies expect to complete the transaction by the end of BD’s first half of fiscal 2023, which is the end of March 2023.
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