Medpace Holdings, Inc.

Medpace Holdings, Inc. is one of the world's leading clinical contract research organizations (CROs) by revenue, solely focused on providing scientifically-driven outsourced clinical development services to the biotechnology, pharmaceutical and medical device industries. The company differentiates itself through a disciplined operating model centered on full-service Phase I-IV clinical development services and therapeutic expertise, which management believes results in timely and cost-effective delivery for customers. Medpace conducts clinical trials across all major therapeutic areas, with particular strength in Oncology, Metabolic, Cardiology, Antiviral and Anti-infective (AVAI) and Central Nervous System (CNS).

Medpace's major CRO competitors include IQVIA Holdings Inc., ICON plc, PPD, Inc. (now part of Thermo Fisher Scientific Inc.), Fortrea, Inc., and numerous specialty and regional CROs. The company believes it competes effectively due to its full-service operating model, deep therapeutic expertise in areas that are among the largest, most complex and fastest growing in pharmaceutical development, its global platform, and its experienced and committed management team. The CRO industry remains fragmented, with several hundred smaller, narrowly focused service providers and a small number of full-service companies with global capabilities, and Medpace believes there are significant barriers to others becoming a global provider offering a broad range of services.

Medpace generates revenue by providing a full suite of services supporting the entire clinical development process from Phase I to Phase IV across a wide range of therapeutic areas. The company earns fees through the performance of services detailed in customer contracts, with contract scope and pricing typically based on either a fixed-fee or unit-of-service model, including reimbursable out-of-pocket expenses. Revenue is recognized based on the satisfaction of individual performance obligations identified in each contract, with substantially all contracts consisting of a single performance obligation satisfied over time, measured primarily utilizing the input method of cost to cost. The company's customer base includes small biopharmaceutical companies, mid-sized biopharmaceutical companies and large pharmaceutical companies, and for the year ended December 31, 2025, 82% and 13% of net revenue was derived from small biopharmaceutical companies and mid-sized biopharmaceutical companies, respectively.

Medpace's services span the entire clinical development process and include a Medical Department providing strategic direction for study design and planning; Clinical Trial Management using ClinTrak, a proprietary information management system; Data-Driven Feasibility; Study Start-Up; Patient Recruitment and Retention; Clinical Monitoring; Risk-Based Monitoring; Regulatory Affairs; Medical Writing; Biometrics and Data Sciences; Pharmacovigilance; Core Laboratory services including imaging and cardiovascular core laboratory; a Central Laboratory operating in four locations including Cincinnati, Ohio; Leuven, Belgium; Shanghai, China; and Singapore; a Bioanalytical Laboratory located on the clinical research campus in Cincinnati, Ohio; Clinics on the Cincinnati campus; and a Quality Assurance team. The company also provides biorepository services and molecular and genetic testing.

The company's revenue by therapeutic area for the year ended December 31, 2025 was as follows: Oncology $747,585 thousand ¹, Metabolic $744,957 thousand ², Other $408,548 thousand ³, Central Nervous System $254,838 thousand ⁴, Cardiology $239,371 thousand ⁵, and AVAI $134,935 thousand ⁶, for total revenue of $2,530,234 thousand ⁷. For the year ended December 31, 2024, revenue by therapeutic area was: Oncology $651,237 thousand ⁸, Metabolic $457,542 thousand ⁹, Other $431,384 thousand ¹⁰, Central Nervous System $181,977 thousand ¹¹, Cardiology $230,454 thousand ¹², and AVAI $156,460 thousand ¹³, for total revenue of $2,109,054 thousand ¹⁴. For the year ended December 31, 2023, revenue by therapeutic area was: Oncology $587,097 thousand ¹⁵, Metabolic $376,842 thousand ¹⁶, Other $404,844 thousand ¹⁷, Central Nervous System $160,057 thousand ¹⁸, Cardiology $193,690 thousand ¹⁹, and AVAI $163,312 thousand ²⁰, for total revenue of $1,885,842 thousand ²¹.

During the year ended December 31, 2025, the company repurchased 2,961,924 ²² shares for $912.9 million ²³ under the share repurchase program. As of December 31, 2025, the company has remaining authorization of $821.7 million ²⁴ under the repurchase program. The company also entered into Amendment No. 9 to the Loan Agreement on July 17, 2025, which changed the aggregate principal amount that may be borrowed under the Credit Facility to up to $10.0 million ²⁵. The company had no indebtedness under the Credit Facility as of December 31, 2025 ²⁶ and December 31, 2024 ²⁷. On February 6, 2025 and May 16, 2025, respectively, the Board adopted and the Company's stockholders approved the 2016 Amended and Restated Incentive Award Plan, which extended the term to expire in 2035 ²⁸.

Total revenue increased by $421.2 million ²⁹, or 20.0% ³⁰, to $2,530.2 million ³¹ for the year ended December 31, 2025, from $2,109.1 million ³² for the year ended December 31, 2024. Net income was $451.1 million ³³ for the year ended December 31, 2025, compared to $404.4 million ³⁴ for the year ended December 31, 2024. Diluted EPS was $15.28 ³⁵ for 2025 versus $12.63 ³⁶ for 2024. Income from operations was $534.9 million ³⁷ for 2025 compared to $446.9 million ³⁸ for 2024. Net cash provided by operating activities was $713.2 million ³⁹ for 2025 compared to $608.8 million ⁴⁰ for 2024.

Medpace's key growth strategies include continued investment in organic growth, continued maintenance of margins, increasing capture of the high-growth clinical development market, deepening existing and developing new relationships with its core customer segment of small and mid-sized biopharmaceutical companies, and attracting, developing and retaining talent. The company believes it is a partner of choice for small and mid-sized biopharmaceutical companies based on its ability to consistently utilize its full-service, disciplined operating model to deliver timely and high-quality results. The company aims to continue to expand its market share in the growing Phase I-IV CRO market as it conducts clinical trials across all major therapeutic areas.

The company's business strategy aims to continue to expand its market share in the growing Phase I-IV CRO market. Medpace believes there are significant barriers to others becoming a global provider offering a broad range of services and products including the cost and experience necessary to develop strong therapeutic areas, expertise to manage complex clinical programs, infrastructure to support large global programs, ability to deliver high-quality services and expertise required to prepare regulatory submissions in numerous jurisdictions. The company also intends to increase its use of web-enabled and other integrated information systems in delivering its services, including ClinTrak.Historically, the company has been able to generate its operating margins because of its disciplined, full-service operating model, but management notes that if the company experiences increased levels of competitive pricing pressure, or pricing pressure from the continued rise of inflation, its operating margins may decrease. The company also notes that it may adapt its operating model to achieve greater levels of growth or in response to investor demands, and such changes could result in lower operating margins.

As of December 31, 2025, Medpace had approximately 6,200 ⁴¹ employees located across 46 countries, compared to approximately 5,900 ⁴² as of December 31, 2024 and 2023. The company has a robust career path and compensation structure, and of the 182 management-level roles that were newly filled between October 1, 2024 and September 30, 2025, approximately 75% ⁴³ of these roles were filled by internal talent. The company has invested in the development and implementation of a global learning management system. Capital spending as a percentage of revenue decreased 49 basis points to 1.24% ⁴⁴ in the year ended December 31, 2025.

The company's expected primary cash needs on both a short and long-term basis are for investment in operational growth, including additional lease commitments, capital expenditures, share repurchases, selective strategic bolt-on acquisitions, other investments, and other general corporate needs. As of December 31, 2025, the company has remaining authorization of $821.7 million ⁴⁵ under the share repurchase program. The company has not paid any dividends to date, nor does it have current plans to pay any cash dividends on its common stock for the foreseeable future. Capital expenditures were $31.4 million ⁴⁶ for the year ended December 31, 2025. Stock-based compensation expense was $34.8 million ⁴⁷ for the year ended December 31, 2025.

The company faces structural headwinds including the potential loss, delay or non-renewal of contracts, and the non-payment by customers for services performed. Clinical trials can be costly and for the year ended December 31, 2025, 82% ⁴⁸ and 13% ⁴⁹ of net revenue was derived from small biopharmaceutical companies and mid-sized biopharmaceutical companies, respectively, which may have limited access to capital. The company also faces risks from increased pricing pressure, inflation, and the potential that its operating margins could decrease if it is unable to achieve efficiencies in operating expenses or grow revenues at a rate faster than expenses.

The company is subject to international economic, political and other risks that could negatively affect results of operations and financial condition, including operations in foreign countries in Europe, Asia, South America, Africa and Australia. Geopolitical issues in Europe, the Middle East, Asia, and South America may impact foreign countries where the company may need to enroll patients in clinical trials. Tariffs imposed by the U.S. government on certain imported goods, equipment, technology, or supplies used in clinical trials, any retaliatory and/or reciprocal tariffs imposed on U.S. exports by foreign countries, including China, as well as any additional tariffs, duties, or other trade measures or restrictions could increase operating costs, disrupt the global supply chain, or otherwise have a material adverse effect on the business.

The potential loss, delay or non-renewal of contracts, or non-payment by customers, could adversely affect results, as 82% ⁵⁰ and 13% ⁵¹ of net revenue for the year ended December 31, 2025 was derived from small and mid-sized biopharmaceutical companies, respectively, which may have limited access to capital. The company bears financial risk if it underprices its fixed-fee contracts or overruns cost estimates, and the majority of Phase I-IV contracts are fixed-fee contracts. Customer concentration is a risk, as approximately 35.1% ⁵² of net revenue for the year ended December 31, 2025 was derived from the top ten customers. The company's backlog may not convert to net revenue at historical conversion rates, and as of December 31, 2025, backlog was $3,027.2 million ⁵³. Outsourcing trends in the biopharmaceutical industry and changes in aggregate R&D budgets could adversely affect operating results and growth rate. Consolidation in the biopharmaceutical industry could lead to a reduction in revenues. The company's Chief Executive Officer and founder, August J. Troendle, controls approximately 19.0% ⁵⁴ of the outstanding shares of common stock as of December 31, 2025, and upon a distribution of common stock held by Medpace Investors LLC, he would receive approximately 85.8% ⁵⁵ of such distributed shares, enabling him to exert significant influence over corporate actions.

Management's message emphasizes the company's position as one of the world's leading CROs by revenue, solely focused on scientifically-driven outsourced clinical development services. The tone is confident in the company's disciplined operating model centered on providing full-service Phase I-IV clinical development services and therapeutic expertise, which management believes results in timely and cost-effective delivery for customers. The strategic priorities emphasized for the period ahead include continued investment in organic growth, continued maintenance of margins, increasing capture of the high-growth clinical development market, deepening existing and developing new relationships with the core customer segment of small and mid-sized biopharmaceutical companies, and attracting, developing and retaining talent. Management also highlights the company's global platform of approximately 6,200 ⁵⁶ employees across 46 countries, providing broad access to diverse markets and patient populations as well as local regulatory expertise and market knowledge.