Cognizant to acquire Zenith Technologies and strengthens its MES capabilities for the life science industry

/ June 19, 2019/ Cognizant, India, Ireland, M&A (large, with revenues above $50m), Manufacturing, Non classé, Pharma, PLM, US

Cognizant has been making more headlines in ER&D services, recently. Last month, we had mentioned its software product engineering services (PES) contract with PLM vendor AVEVA. This week, we are looking into Cognizant’s planned acquisition of Zenith Technologies.

Zenith Technologies is headquartered in Cork, Ireland and provides shop-floor IT system services, working around MES, DCS, plc and SCADA, and data historian, for the pharma and medical device industry. The company is sizeable with 800 employees. We estimate its revenues to USD 80-100m.

Zenith provides IT services ranging from implementation to managed services (monitoring, incident triage, and demand management). The company has expected into IoT implementation (mostly around PTC Thingworx and Articulate 360), and complementing IoT, in data analytics Tableau, IBM, SAS, Dassault Biovia, Umetrics. Zenith has other specialties including serialization and an IP, Incident Control Room, with two verticalized versions, for fire & rescue and the education market.

The life science sector is strategic to Cognizant. The company is a major vendor in the US healthcare market, with a historical presence, in healthcare insurance (healthcare payer) reinforced by the 2014 acquisition of TriZetto. However, in the past two years, Cognizant has been impacted by several clients (CBS, Aetna and Sigman Express Scripts) delaying their IT service spending, as a result of mergers.

Cognizant has been growing its presence in life science (pharma and medical devices), while also investing in the US healthcare provider space. In life science, The company has in life science been active in clinical trials: in Q1 2019, it has announced a service partnership with a clinical trial ISV specialist Medidata (in the process of being acquired by Dassault Systemes).

Also, Cognizant also has several IP related to clinical trials:

  • Shared Investigation Platform, a portal that is meant to be used by several pharmaceutical firms and that aims to automate administrative tasks related to clinical trials
  • SmartTrials, a tool collecting operational and patient data.
  • Cognizant Protocol Creator, a SaaS tool to automate the development of clinical trial protocol documentation.

With Zenith, Cognizant is, therefore, adding a capability to service the pharma sector. The company continues to approach by developing its capabilities for IT systems used by R&D departments, rather than by R&D itself. Given the importance of the pharma sector to Cognizant, we expect Cognizant to continue expanding its portfolio in the sector. Stay tuned.

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