Contract research organization Cetero Research is closing its Cary headquarters and moving operations to North Dakota following its sale after bankruptcy proceedings. No local employees will lose their jobs in the move.
On June 20, the Chicago-based Freeport Financial Group, which owned Cetero’s brick-and-mortar properties, finalized its $80 million purchase of the company, which will now be called the PRACS Institute after a legacy company Cetero had purchased in 2006.
Cetero, which conducts Phase I and Phase II clinical trials for pharmaceutical companies, struggled financially over the past year and filed for bankruptcy in March. The move was spurred by a yearlong investigation the Food and Drug Administration conducted into allegations of fraud by chemists in Cetero’s Houston laboratory, who had falsified clinical trial records to be paid overtime.
The FDA investigation was resolved in April, and PRACS Institute is still redoing some work for the pharmaceutical companies whose records were affected by the investigation.
James Carlson is the new CEO, replacing Troy McCall. Carlson is the co-founder of the original PRACS Institute and sold the Fargo-based company to Cetero. He served on the board of directors for a number of years before resigning last fall.
The company’s 15 employees based in Cary can work remotely for the new company and will not lose their jobs when the local office closes on July 31st. These employees were in financial support, marketing and training for Cetero and will continue their roles with PRACS. The company has more than 1,000 employees in the United States.
Triangle-based members of senior management will move to one of the company’s five other locations— most likely the new company’s headquarters in Fargo, N.D. Local employees learned of the prospective sale and office closure about a month ago.
“[The Cary employees are] good at their jobs,” Carlson said. “There’s no particular need to relocate them, as those positions work well from home. When we need to have a face-to-face meeting, we’ll fly them into our other facilities to have the meeting.”
Moving the headquarters from Cary to Fargo, where PRACS has the world’s largest facility designed for Phase I clinical research, made sense because of the quality of facilities and ample office space in the Fargo facility, Carlson noted.
The Fargo branch of PRACS measures 250,000 square feet and can host all stages of the clinical trial process. “It is all encompassing from the first phone call, to the final FDA report,” Carlson said.
The name change from Cetero to PRACS was a business decision in which the new management chose to use some of its best equity, which was a name with a 20-year history compared to the six-year history of Cetero.