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Friday, September 5, 2008

Phase Forward pays $40M for Clarix of Radnor

    Swarthmore grad Jagath Wanninayake and his colleagues are getting paid $40 million by drug-testing software vendor Phase Forward, of Waltham, Mass., for the software firm he heads, Clarix LLC. 
    Clarix's "Web-integrated interactive response technology" is used to help run clinical drug trials. Clarix counts "11 of the top 25 pharmaceutical companies" as clients. Clarix employs 70 at its Radnor headquarters and 15 at its office in Romania, including software R&D people, testers, customer support, quality assurance and sales. 
   UPDATE: Clarix's Wanninayake, a Sri Lanka native, graduated Swarthmore College in 1998 and went right to work at venture investor Blue Rock Capital in Delaware. But when he started Clarix four years later, Wanninayake says he chose not to accept venture or private equity funding; instead, managers and workers own the equity and will share in the sale millions. "We wanted to build a long-lasting, sustainable business We weren't interested in a quick-hit-and-sale strategy."
   He said the Philadelphia area's "a wonderful place to run a software company. There's a ton of great schools. There's a lot of pharmaceutical talent. There's a lot of research. You're very close to other metro areas, like New York. And the city is really becoming a fun place to live in or around."
  Why sell now? "Phase Forward is a like-minded team at a larger company. They understand software and technology. Most important, they understood the cultural intangibles that go to building a successful software company: the emphasis on hiring the right talent, on encouraging creativity, on things that are easy to say but hard to do."
  Phase Forward CEO Robert Kirby Weiler, who headed sales for Lotus before it was bought by IBM, purchased Clarix as part of his bid to expand his company's product offerings, as Big Pharma companies try to reduce the number of vendors and contractors they hire.
  "He's a strong believer that, if you're a credible leading organization and you can add bits the customer you're selling to want, you'll win at the end of the day," said Martin Young, Weiler's vice president for corporate development. "These guys were running lean. They don't have the infrastructure. We can add that. They have done a great job of hiring really bright people out of the local schools and employment area and bringing them up to speed... This company is going to grow sales, and add people."   
  
    

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About Joseph N. DiStefano
Joseph N. DiStefano writes this blog to feed his PhillyDeals column in the Philadelphia Inquirer. Joe has been a member of Bloomberg LP’s New York Finance Team, wrote the book “Comcasted,” taught writing at St. Joseph’s University, and studied economics and history at Penn. Reach Joe at 215-854-5194 and JoeD@phillynews.com
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