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Seven Key Site Visit Considerations for Your Due Diligence Team

Scott Snyder, Sr. Director, Portfolio Marketing, Merrill Corporation | July 07, 2017

During the recent Due Diligence Summit for Life Sciences in Boston, the strategic importance of a site visit prior to executing an M&A, licensing, or strategic partnership event was highlighted as an essential component of a comprehensive due diligence plan. There was broad agreement that these visits can be an extremely beneficial – but they must be carefully planned and executed for maximum impact. If you are preparing for a site visit, keep these seven simple due diligence considerations in mind – or risk a trip labeled as inefficient, or worse, ineffective. 

Seven Key Considerations in Site Visit Planning

Seven Key Site Visit Considerations: Life Sciences M&A, Licensing and Strategic Partnership Transactions

1.     Early Document Preparedness by the Seller/Licensor

Showing up on-site and asking the seller/licensor for the documents you want to review is counterproductive. The best practice is to share a list of documents your team will want to see and discuss several weeks in advance. Presuming you have established a Merrill DataSite VDR, ask the seller/licensor to load the documents to the site so your team can examine them prior to arriving.

2.     Assemble the Right Team

Make sure the right people are on the visit. Nothing is more frustrating than everyone arriving that first morning, only to discover someone with critical knowledge or expertise wasn’t invited. If schedule conflicts mean someone can’t attend, make sure you have time designated for them to be a part of the discussion either by audio or videoconferencing. This is especially true if their knowledge or expertise is critical in crossing key due diligence milestones.

3.     Ensure Internal Alignment

Your time is limited – make sure your visit is efficient and comprehensive. Meet with your due diligence team as an entire group before the trip. Ensure everyone understands their role for the visit, and set clear objectives and accountabilities. The stakes are high – you may need more than one meeting to ensure total alignment.

4.     Debrief After Each Day

Gather as a team at the end of each day to discuss key learnings and adjust the objectives for the next day. Have key questions been answered? Have new questions surfaced that you’d like to have addressed by the end of the visit? Giving the team a venue to voice their comments helps ensure ongoing alignment.

5.     Understand Cultural and Climate Differences

A site visit can provide keen cultural insights to see if the seller is truly a good fit for your organization. Understanding culture and climate differences between companies is an often overlooked -- but critical -- aspect of life sciences due diligence, especially since agreements will often extend for many months or years. While a pact might make strong business sense, exposing and understanding differences can be an important part of success in an M&A, licensing or partnership transaction. Consider having a skilled human resources representative as a part of the due diligence team to focus specifically on this element of the transaction.  

6.     Meeting Off-Site vs. On-site

While you may have requirements to view facilities and equipment, having your full due diligence team arrive at a company headquarters can raise unnecessary awareness of a potential transaction or agreement. To avoid this, consider meeting at a nearby location to help minimize the odds of disruption that could derail the transaction. An on-site visit may be essential for comprehensive due diligence, and this can often be accomplished by sending a small delegation of facility and equipment experts on-site to conduct a visual review and gather key facts.

7.     Centralized Team Scheduling and Travel Logistics

Team scheduling and travel logistics aren’t line items on an agreement, but overlooking these basics can be a major disruptor. For site visit teams with more than three delegates, consider having one person responsible for all meeting logistics. Responsibilities could include items such as air travel, hotel accommodations, meal reservations, ground transportation and audio/video conference coordination. Centralizing this responsibility helps mitigate potential distractions and allows the team to focus on the task at hand.

Taking a strategic approach to planning and executing a site visit is a critical component of a comprehensive due diligence plan. The knowledge derived from on-site meetings can be invaluable in determining if an M&A, licensing, or strategic partnership is right for your objectives.

 

Learn More:

  1. Brochure: Navigating complex life sciences opportunities through structured information management
  2. Webinar Playback: Executing Effective M&A in the Emerging Healthcare Sector
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