Quintiles' Gillings mulling IPO to fund Asian expansion

The founder and CEO of Quintiles Transnational might consider another IPO, as the global financial markets improve.

Dennis Gillings told Bloomberg News in a phone interview from Australia that an initial public offering of stock would allow his Durham-based company to raise money to expand in Asia.

An IPO would help fund acquisitions in that region, which is increasingly important in Quintiles' business of conducting clinical trials of experimental drugs. Quintiles, which is the world's largest pharmaceutical services company, has nearly tripled its staff in Asia over the past decade, while worldwide employment has risen 50 percent.

"Investment bankers almost hound me to do" an IPO, Gillings told Bloomberg.

Quintiles officials haven't spoken to the Securities and Exchange Commission about listing the company or hired an investment bank to manage an IPO, and Gillings said he wants to wait for financial markets to improve first.

"We've got a pretty equal chance of staying private or going public," he said. "But it we do go public I think we'd want a little more attractive market."

Gillings, the former UNC Chapel Hill professor who founded Quintiles in 1982, first took the company public in 1994 but grew increasingly frustrated with public ownership. In 2003, he orchestrated a buyout that took the company private again.

Rumors about Quintiles becoming publicly traded again have swirled for several years, said David Windley, an analyst who covers contract-research organizations such as PPD for Jeffries & Co. in Nashville.

"To my knowledge this would be a first and strong signal for Dennis to proactively want to talk about it," Windley told Bloomberg.

Becoming public again would make it easier for Quintiles to make larger acquisitions, especially in Asia, which Gillings said is the "engine room" for the pharmaceutical industry.

"Drug development is a little more cost-effective in Asia and that's partly because of labor costs and also there really are a lot of patients in Asia," he told Bloomberg.

Asia now accounts for about 17 percent of patients in drug trials Quintiles runs, and Gillings expects that total to rise to one third by 2020.

Quintiles spokesman Phil Bridges declined further comment on possible IPO plans, but added that Asia, especially China and India, are important markets for the company.

"Quintiles has a presence throughout Asia and we are seeking to increase that presence through a variety of means including organic growth, partnering and possibly acquisitions," Bridges said in a prepared statement.

Gillings has said Quintiles' annual revenue is approaching $3 billion. The company employs more than 20,000 people worldwide, including 1,400 in the Triangle.

In May, the company laid off a "limited" number of workers, as part of a broader cost-cutting effort. The company continues to hire in the U.S., including at its world headquarters in the Imperial Center business park off Interstate 40, which opened last year.