Phase Forward (NASDAQ: PFWD), a leading provider of data
management solutions for clinical trials and drug safety, today
announced that it has acquired privately held Green Mountain Logic
(GML) in an all-cash transaction valued at $5.25 million. The company,
based in Montpelier, Vt., is an innovative vendor of process
automation software for managing Phase I clinical trials. GML, which
was founded in 1998, will continue to operate from its Vermont
offices, and John Rosenblum, GML´s president, will become a Phase
Forward vice president responsible for GML´s products.
GML´s primary product is LabPas CT(TM), which manages clinic
workflow and information from the subject recruiting process through
data collection and sample management during Phase I clinical trials.
The LabPas CT product helps to link subjects with their laboratory
samples, matching barcodes on subject wristbands and the appropriate
samples to help ensure data integrity. In addition, since the data
collection process during Phase I trials is often a tightly scheduled,
multi-step process, LabPas CT includes workflow automation
capabilities to help sites prepare for a study and to help streamline
the clinical and laboratory processes when conducting the study. Phase
Forward plans to integrate this technology with its eClinical Suite
with the goal of improving the efficiency and effectiveness of Phase I
trials as well as speeding time to data lock. Phase Forward´s
InForm(TM) Integrated Trial Management (ITM) product is already
considered a market-leading product for electronic data capture (EDC),
and the addition of the LabPas CT technology further strengthens Phase
Forward´s offerings across the development lifecycle.
"Green Mountain Logic´s LabPas CT brings important functionality
to the Phase Forward product portfolio, enabling us to offer a broader
and more extensive solution for Phase I clinical trials," said Bob
Weiler, president and CEO, Phase Forward. "Phase I trials represent an
important growth area for our products. In addition, it is an area of
strategic importance, since Phase I trials establish a relationship
with customers at the earliest possible stage of the development
cycle."
Phase I clinical trials represent one of the fastest-growing
segments of the market. According to figures released by Goldman Sachs
in 2006, Phase I research and development spending in the U.S. was
$5.2 billion in 2005, rising to $5.8 billion in 2006, and is projected
to grow to $8.9 billion in 2010. For the EDC sector, Phase I growth is
projected to be particularly robust, with the market in the U.S. alone
estimated at $45 million in 2007, growing to $120 million in 2010,
according to an April 2007 report from market research firm Health
Industry Insights ("U.S. Electronic Data Capture 2006-2011 Spending
Forecast and Analysis," report # HI206351).
The growth of Phase I trials makes the sector an important target
for contract research organizations (CROs). GML is already working
with several leading CROs and Phase Forward´s relationships with over
50 CROs provide further opportunities for GML to expands its CRO
footprint. Phase Forward believes the combination of LabPas CT and
Phase Forward´s products will be an attractive offering for this
sector.
"We recognize strong synergies between the GML product line and
Phase Forward´s comprehensive electronic clinical data solutions,"
said John Rosenblum, CEO and president of Green Mountain Logic. "GML´s
Phase I customers are seeking better integration between quality Phase
I data and established clinical data capture and management systems.
By aligning these two product areas, Phase Forward is in a position to
proactively address this emerging market trend. We are excited to be
joining this market-leading company."
The acquisition is not expected to have a material impact on the
company´s previously issued revenue guidance for 2007, and it is
expected to be dilutive by approximately $0.01 to both GAAP and
non-GAAP earnings per share. Non-GAAP results exclude stock
compensation expense and amortization of intangibles associated with
the Lincoln Technologies and GML acquisitions. Phase Forward expects
the acquisition to add between $1 million and $2 million to revenues
in fiscal 2008 and to be dilutive by between $0.02 to $0.03 to GAAP
earnings per share and dilutive by between $0.01 to $0.02 to non-GAAP
earnings per share.
Green Mountain Logic´s Products
GML´s LabPas CT product helps to reduce errors throughout trials
with barcode scanning of subjects, treatments and laboratory samples.
The system includes features to facilitate real-time data capture of
vital signs, adverse events, clinical test results and other clinical
events. LabPas CT supports compliance with FDA 21 CFR Part 11 with
electronic signature capabilities and audit controls throughout the
system.
In addition to LabPas CT, GML offers LabPas EM, an environmental
monitoring product designed to support precise reporting of subject
sample storage conditions. GML´s portfolio also includes LabPas LIMS,
a workflow module that automates sample processes for life science
laboratories. The LabPas products are based on an advanced and highly
flexible software platform that allows Phase Forward to further
explore other segments of the market.
About Phase Forward
Phase Forward is a leading provider of integrated data management
solutions for clinical trials and drug safety. The company offers
proven solutions for electronic data capture (InForm(TM)), clinical
data management (Clintrial(TM)), clinical trials signal detection
(CTSD(TM)), strategic pharmacovigilance (WebVDME(TM) and Signal
Management), adverse event reporting (Clintrace(TM)) and applied data
standards (WebSDM(TM)). In addition, the company provides services in
the areas of application implementation, hosting and validation, data
integration, business process optimization, safety data management and
industry standards. Phase Forward´s products and services have been
utilized in over 10,000 clinical trials involving more than 1,000,000
clinical trial study participants at over 250 organizations and
regulatory agencies worldwide including: AstraZeneca, Boston
Scientific, Dana-Farber Cancer Institute, Eli Lilly, the U.S. Food and
Drug Administration, GlaxoSmithKline, Harvard Clinical Research
Institute, Merck Serono, Novartis, Novo Nordisk, PAREXEL
International, Procter & Gamble, Quintiles, sanofi-aventis,
Schering-Plough Research Institute, Servier, Tibotec and the U.K.
Medicines and Healthcare Products Regulatory Agency. Additional
information about Phase Forward is available at www.phaseforward.com.
Cautionary Statement
Certain statements made in this press release that are not based
on historical information are forward-looking statements which are
made pursuant to the safe harbor provisions of the Private Securities
Litigation Reform Act of 1995. This press release contains express or
implied forward-looking statements relating to, among other things,
Phase Forward´s expectations and assumptions concerning financial
performance of Phase Forward following the consummation of its
acquisition of Green Mountain Logic, Phase Forward´s ability to
achieve expected synergies as a result of the acquisition, and the
strengthening of Phase Forward´s market position as a result of the
acquisition. These statements are neither promises nor guarantees, but
are subject to a variety of risks and uncertainties, many of which are
beyond Phase Forward´s control, which could cause actual results to
differ materially from those contemplated in these forward-looking
statements. In particular, the risks and uncertainties include, among
other things, Phase Forward´s inability to successfully integrate
Green Mountain Logic and its employees into Phase Forward and achieve
expected synergies; Phase Forward´s ability to accurately forecast the
acquisition related restructuring costs and allocation of the purchase
price, goodwill and other intangibles, and acquisition related and
other asset adjustments; costs associated with and consequential to
the acquisition and integration of Green Mountain Logic and benefits
realized from the acquisition; our ability to convince prospective
customers to adopt our solutions; competition; changing customer
requirements; governmental regulation; our ability to maintain
profitability; fluctuations in our operating results; long sales and
implementation cycles; our dependence on a limited number of customers
or suppliers; product performance; third party service interruptions
or delays; technology failures; our ability to maintain customer
relationships and contracts; our ability to retain and hire skilled
personnel; our ability to protect our intellectual property rights;
product liability or intellectual property infringement claims brought
against us; acquisitions; our ability to manage our rapid growth; our
ability to obtain capital when desired on favorable terms; and the
volatility of the market price of our common stock. Existing and
prospective investors are cautioned not to place undue reliance on
these forward-looking statements, which speak only as of the date
hereof. Phase Forward undertakes no obligation to update or revise the
information contained in this press release, whether as a result of
new information, future events or circumstances or otherwise. For
additional disclosure regarding these and other risks faced by Phase
Forward, see the disclosure contained in Phase Forward´s public
filings with the Securities and Exchange Commission including, without
limitation, its most recent Quarterly Report on Form 10-Q.
