Flyover Stock: Medpace (MEDP)
A Midwestern clinical contract research organization with high growth, an invested founder/CEO, and sparse sell-side coverage
When most people think about Midwestern companies, they think about manufacturing, logistics, and consumer staples. And you can indeed find those industries here.
But technology and biotech? That’s what you find on the coasts, the thinking goes. Not in the Midwest.
That may have been true 20 years ago, but the times are changing. Thanks to relatively lower overhead costs, access to top research universities and hospitals, proximity to valuable logistics infrastructure, and more, the Midwest is in the early stages of a renaissance in cutting-edge science and technology.
To illustrate, both Intel and Google have made multi-billion-dollar investments in Ohio to build chip factories and data centers, respectively. Cincinnati-based Enable Injections recently received FDA approval for its wearable injector that, according to the company, is the "first purely mechanical, large-volume, on-body subcutaneous drug delivery device." The list is growing by the year.
Another example is a company that’s a short drive from my front door. It was founded 31 years ago, went public in 2016, and its growth has rapidly accelerated in the last decade.
A few years ago, I attended a CFA Society of Cincinnati event at a hotel on the east side of town. The hotel was spacious, new, and filled with contemporary art. What made it surprising was that it wasn't near much except an office park next door.
The company next door, it turned out, was Medpace, a clinical contract research organization (CRO) that helps biotech firms conduct clinical trials and take their drugs toward commercialization. Its growth over the past decade has been nothing short of spectacular.
When I asked someone about the hotel, they told me the Medpace CEO renovated it to house biotech executives visiting from out of town. Located in Madisonville, about 10 miles from downtown Cincinnati, Medpace couldn’t find suitable hotels near its campus, so the CEO built one (through a separate holding company) by renovating an existing building.
As we'll learn, Medpace's founder and CEO, Dr. August Troendle, has a nose for creating value. He and his company are worth knowing about.
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