Stout provided buy-side financial due diligence services to a private equity platform executing the acquisition of a multi-specialty clinical research center located in Palmetto Bay, Florida. The target company conducts Phase I-IV clinical trials across a wide range of therapeutic areas, including cardiology, dermatology, endocrinology, gastroenterology, infectious disease, internal medicine, nephrology, neurology, psychiatry, rheumatology, and women’s health.

Stout’s Financial Due Diligence team performed a comprehensive quality-of-earnings analysis, along with detailed net working capital and net debt procedures. A significant component of the engagement involved a consolidation and revenue recognition analysis, as the company operated through two separate legal entities tracked in different accounting systems.

The team accessed QuickBooks data, as well as information from the clinical trial management system, eClinPro, to conduct a detailed cash-to-accrual and cut-off analysis. As part of this effort, Stout evaluated the impact of key revenue drivers, including CRO and Sponsor holdbacks, screen failures, start-up and close-out fees, patient stipends, and other trial-related components.

Stout’s work revealed critical insights that informed the transaction and provided the client with a deeper understanding of the company’s financial performance.