Background and Challenge
L.E.K. Consulting was brought on to support our pharmaceutical client with the separation, integration planning and integration execution of a similarly-sized drug technologies company from a global pharmaceutical company. The deal was transformative, moving our U.S.-centric and research-focused client into a global organization with expanded capabilities, products, services and operational scale. Maintaining business stability upon transaction close and ensuring a seamless transition during the early post-close period was critical and complicated by the need to separate the target from its parent company before integration activities could be completed.
Approach and Recommendations
We supported the development of detailed transition services agreements to achieve efficient separation from the parent company, which ensured business stability during the integration process. We mobilized the integration teams and established the integration management office (IMO) to help manage and oversee the planning and execution of the integration. Furthermore, we provided integration support to several functional groups including: human resources, communications, finance, information technology (IT), R&D, facilities, manufacturing and supply chain, quality, and regulatory affairs. In addition, we worked with the R&D and IT leadership to identify needed organizational changes that would position these functions for long-term success given the combined company’s new strategic direction.
The integration proceeded efficiently and surpassed our client’s synergy targets. Critical to this success was our support in developing comprehensive transition services agreements to enable uninterrupted business during the near-term transition period. Furthermore, our client was well prepared for a successful day one transition. There were no supply interruptions and revenues from existing commercial products were protected, back office operations ran smoothly, and town hall meetings allowed the combined company to establish a sense of unity.