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Certara, Inc. is a global leader in biosimulation and model-informed drug development. The company provides software products and technology-driven services that help optimize drug discovery, preclinical and clinical research, regulatory submissions, and market access. Certara's offerings are designed to accelerate drug development programs, reduce costs, and increase the probability of success for its customers.
- Services - Offers technology-enabled services that streamline clinical trials and regulatory submissions, enhancing drug development efficiency and success rates.
- Software - Provides biosimulation software that supports predictive modeling and simulation, facilitating efficient drug development and regulatory compliance.
| Name | Position | External Roles | Short Bio | |
|---|---|---|---|---|
John E. Gallagher III Executive | Senior Vice President and Chief Financial Officer | John E. Gallagher III has served as Certara's Senior Vice President and Chief Financial Officer since April 1, 2023. He is a seasoned finance leader with prior experience as CFO at Cue Health and in various executive roles at BD and other companies. | ||
Leif E. Pedersen Executive | President, Chief Commercial Officer | Leif E. Pedersen is the President, Chief Commercial Officer at Certara since August 2023, and previously served as President of Software from September 2020 to August 2023. | ||
Robert P. Aspbury Executive | President of Certara Scientific Software | Robert P. Aspbury has served as President of Certara Scientific Software since January 2020. He previously served as the Chief Operating Officer of the Simcyp Division from April 2019 to December 2019. | ||
David Spaight Board | Class I Director | Operating Partner at Arsenal Capital Partners | David Spaight was appointed as a Class I Director at CERT on December 8, 2022 and serves on the Compensation Committee with a term expiring at the 2024 Annual Meeting of Shareholders. He has over 35 years of experience in the life sciences industry, having held leadership roles at organizations such as Arsenal Capital Partners, WIL Research Laboratories, and MDS Pharma Services. | |
Eran Broshy Board | Director | Board Member at Theravance Biopharma, Inc.; Board Member at Thirty Madison | Eran Broshy serves as Director and Chair of the Nominating and Corporate Governance Committee at Certara since July 2022. He also holds active board roles at Theravance Biopharma, Inc. and Thirty Madison, underscoring his extensive leadership experience. | |
Matthew Walsh Board | Director | Executive Vice President and Chief Financial Officer at Organon & Co. | Matthew Walsh is a Director at CERT since August 2020 and serves as the Chair of the Audit Committee. He has extensive experience in senior financial roles, including his current role as Executive Vice President and Chief Financial Officer at Organon & Co. since June 2020. | |
Rosemary Crane Board | Class III director | Current Board Member at Tarsus Pharmaceuticals, Inc.; Current Board Member at Teva Pharmaceutical Industries Limited | Rosemary Crane is a Class III director at Certara since July 21, 2022. She brings extensive pharmaceutical and board expertise, with active roles as a Current Board Member at Tarsus Pharmaceuticals, Inc. and Teva Pharmaceutical Industries Limited. |
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Given that adjusted EBITDA margins are expected to decline in 2025 due to increased R&D investments and the integration of Chemaxon, can you provide more clarity on the timeline for when margins will return to previous levels and what specific milestones need to be achieved to realize these margin improvements?
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With the integration of Chemaxon underway, can you elaborate on the challenges you're facing in aligning Chemaxon's lower margins with Certara's margins, and what steps are being taken to ensure the acquisition contributes positively to earnings in the near term?
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The software net retention rate declined to 106% in Q4, down from 108% for the full year, partly due to spending patterns of Tier 1 customers; does this indicate a potential trend of decreased software adoption among large pharma clients, and how do you plan to address this issue?
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You mentioned cautious spending behavior among customers and elongated decision-making timelines; given this, are the revenue growth assumptions of 8–10% for 2025 realistic, and what gives you confidence in achieving this guidance despite ongoing market headwinds?
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Regarding the strategic review of the regulatory writing business, can you provide any insights into the potential outcomes being considered, and how a decision to divest or restructure this segment would impact Certara's overall growth strategy and financial performance?
Competitors mentioned in the company's latest 10K filing.
| Company | Description |
|---|---|
Mathworks | Competes in the biosimulation software market, offering technology solutions that vary in size, capabilities, and breadth. |
Dassault Systemes | Provides technology solutions in the biosimulation software market, competing on functionality, quality, and regulatory acceptance. |
Operates in the biosimulation software market, competing on ease of use, functionality, and integration capabilities. | |
A competitor in the biosimulation software market, focusing on molecular types, therapeutic areas, and modalities supported. | |
NONMEM (a division of ICON) | Offers biosimulation software solutions and competes on scientific, technical, and regulatory expertise. |
R | An open-source solution competing in the biosimulation software market, providing free software and intellectual property. |
PK-Sim | An open-source biosimulation software solution competing with proprietary offerings. |
Metrum Research | Specialized service provider competing in technology-enabled services, focusing on drug development expertise. |
qPharmetra | Competes in technology-enabled services, offering specialized expertise in drug development. |
Pharmetheus | A specialized service provider competing in technology-enabled services, focusing on scientific and regulatory expertise. |
Notable M&A activity and strategic investments in the past 3 years.
| Company | Year | Details |
|---|---|---|
Chemaxon | 2024 | Certara acquired Chemaxon with a total cash consideration of $90 million, announced on July 9, 2024 and closed on October 1, 2024, to enhance its drug discovery offerings by integrating Chemaxon’s leading cheminformatics software with its biosimulation, AI technology, and Certara Cloud. |
Formedix Limited | 2023 | Certara acquired Formedix Limited on October 10, 2023 for up to $39 million (comprising $30 million in cash and up to $9 million in deferred contingent consideration), adding clinical metadata repository and clinical trial automation capabilities to its portfolio. |
Drug Interaction Solutions (DIDB) | 2023 | Completed on June 20, 2023, the acquisition of DIDB from the University of Washington involved a total consideration of $8.3 million (with up to $2.0 million contingent on future revenue), including assets such as trademarks, database content/technology, and customer relationships, with a detailed purchase price allocation. |
Integrated Nonclinical Development Solutions (INDS) | 2022 | Acquired on January 3, 2022 for a total of $8.0 million, INDS brought in the SEND Explorer software and consulting capabilities, with purchase price allocation covering customer relationships, developed technology, non-compete agreements, and goodwill, and was not significant to overall financials. |
Recent press releases and 8-K filings for CERT.
- Preliminary Q1 2025 results showed revenue of $106.0 million (up 10% compared to Q1 2024) with notable software and services revenue growth, and bookings reached $118.0 million (up 12%).
- The company also announced a $100 million share repurchase authorization, reiterated full-year 2025 guidance, and confirmed a one-year lock-up agreement with Arsenal Capital Partners until April 2026.
- Strong Q4 bookings driven by acquisitions, including the integration of Chemaxon and other deals, supported robust organic performance.
- Delivered 2025 revenue guidance of $415–425 million with overall growth of 8–10% and an organic software growth target of 6–8% fueled by organic sales and acquisitions.
- Emphasized AI integration via CoAuthor and advanced regulatory writing tools, with continued R&D investments to enhance core platforms (Simcyp, Phoenix, Pinnacle) and unify cloud architecture.
- Recorded an adjusted EBITDA margin of 32% in Q4, demonstrating effective cost and capacity management.
- Initiated a strategic review of its regulatory business and refined customer segmentation, noting a turnaround in Q4 bookings for Tier 1 despite mixed Tier 2 and 3 performance.
- Maintained an active M&A strategy to support ongoing growth with further opportunistic software deals.
- Certara, Inc. filed an 8-K report on March 5, 2025 detailing recent corporate events.
- Dr. Patrick F. Smith stepped down as President of Certara Drug Development Solutions effective March 3, 2025, while remaining with the company in a senior advisory and scientific role.
- Delivered $100.4M in Q4 2024 revenue, reversing a $12.5M loss to net income of $6.6M with $33.5M in adjusted EBITDA .
- Achieved 14% YoY Q4 revenue growth and posted full-year revenue of $385.1M (9% growth) driven by strong software and services .
- Delivered robust Q4 bookings of $144.5M (up 22% YoY) with significant contributions from Chemaxon .
- Boosted operational performance via its biosimulation business and Chemaxon support, with Chemaxon expected to contribute $23–$25M .
- Provided FY2025 guidance of $415–$425M in revenue and an adjusted EBITDA margin of 30–32%; adjusted diluted EPS is forecast at $0.42–$0.46 .
- Outlook further includes projected organic growth in the range of 4–6% .
- At the 43rd Annual J.P. Morgan Healthcare Conference 2025, Certara presented forward-looking statements with detailed risk factors and safe harbor disclosures for FY 2025 .
- Demonstrating its biosimulation leadership, Certara’s industry-leading technology platform is utilized by over 2,400 companies and 23 global regulatory agencies, with integrated platforms delivering cost savings of approximately $300 million per approved drug .
- Certara outlined a robust growth strategy featuring disciplined M&A activity, robust software revenue expansion, and continuous investments in R&D and technology innovation .
- The company unveiled AI and product innovation with the launch of the AI-powered CoAuthor, achieving around 30% cost and time savings on clinical study reports and generating multi-million dollar sales .
- A strategic acquisition of Chemaxon further enhances drug discovery capabilities by integrating chemical database search and product design for improved candidate selection .
- Strong financial results were reported with Q4 revenue growth of 13%, bookings growth of 22%, and full-year figures at 8% and 11%, alongside plans to streamline non-core regulatory services .
- Preliminary Q4 2024 results showed revenue of $99.7 million and bookings of $144.5 million, with strong software and services performance.
- Full-year 2024 performance included revenue of $384.4 million and bookings of $445.3 million, with Adjusted EBITDA expected between $120 million and $124 million.
- The report includes details of the Chemaxon acquisition completed on October 1, 2024, which contributed notably to the quarter's revenue and bookings.