Key Takeaways
- • Partners Group Private Equity (PEY) wrote off its entire €20m (£17.3m) investment in Pharmathen to zero after the Greek pharmaceutical company received an FDA import alert that severely restricted US exports, its primary market.
- • Despite "major operational turnaround initiatives" over the preceding year, PEY determined Pharmathen's restricted enterprise value would be insufficient to service the company's existing debt, triggering the full write-down in April 2026.
- • PEY also prudently adjusted down its €24.4m stake in United States Infrastructure Corporation (USIC) due to lower earnings growth driven by customer insourcing and operational headwinds.
- • The dual write-downs contributed to PEY's continued underperformance: NAV declined 2.5% in April to €830.1m (€12.26 per share), marking the fourth month this year the portfolio fell, with the fund trading at a 32% discount to NAV and posting a 13.6% five-year loss for shareholders.
- • PEY partially offset losses through the completion of its Clario health tech sale (announced November 2025), which generated €23.9m in proceeds, enabling €18.1m in additional share buybacks.
Summary
Partners Group Private Equity has fully written down its investment in Pharmathen, a Greek contract development and manufacturing organization (CDMO) founded in 1969, after the company received an FDA import alert that effectively blocked its access to US markets. The investment, originally valued at €20m (£17.3m), was eliminated to zero in April 2026 following restrictions that made the company's implied enterprise value insufficient to cover existing debt obligations.
Partners Group originally acquired Pharmathen from BC Partners in July 2021 at an enterprise value of approximately $1.9bn (€1.6bn), positioning the Greek pharmaceutical company as a leading developer of advanced drug delivery technologies. However, the subsequent FDA import alert—issued in the prior year—fundamentally undermined the investment thesis. Despite what PEY characterized as "major operational turnaround initiatives over the last year," the regulatory restrictions to US exports proved insurmountable. The company's vertically integrated business model and significant R&D investments (approximately €40m annually) could not offset the loss of access to its primary export market.
The Pharmathen write-down was accompanied by a second portfolio adjustment: PEY prudently reduced its €24.4m stake in United States Infrastructure Corporation (USIC), a US-based underground utility locating services provider, to reflect lower earnings growth stemming from customer insourcing initiatives and operational headwinds.
These twin impairments contributed to continued deterioration in PEY's performance. The fund's NAV fell 2.5% in April to €830.1m, or €12.26 per share, representing the fourth monthly decline in 2026 following an 8.7% full-year loss in 2025. PEY trades at a significant 32% discount to NAV and ranks as the second worst performer in its sector over five years, with a cumulative 13.6% loss for shareholders.
The fund partially mitigated near-term capital pressures through completion of the Clario health tech provider sale (initially announced in November 2025), which returned €23.9m in proceeds and enabled allocation of an additional €18.1m toward share buyback programs, a mechanism to address the persistent NAV discount.
Partners Group originally acquired Pharmathen from BC Partners in July 2021 at an enterprise value of approximately $1.9bn (€1.6bn), positioning the Greek pharmaceutical company as a leading developer of advanced drug delivery technologies. However, the subsequent FDA import alert—issued in the prior year—fundamentally undermined the investment thesis. Despite what PEY characterized as "major operational turnaround initiatives over the last year," the regulatory restrictions to US exports proved insurmountable. The company's vertically integrated business model and significant R&D investments (approximately €40m annually) could not offset the loss of access to its primary export market.
The Pharmathen write-down was accompanied by a second portfolio adjustment: PEY prudently reduced its €24.4m stake in United States Infrastructure Corporation (USIC), a US-based underground utility locating services provider, to reflect lower earnings growth stemming from customer insourcing initiatives and operational headwinds.
These twin impairments contributed to continued deterioration in PEY's performance. The fund's NAV fell 2.5% in April to €830.1m, or €12.26 per share, representing the fourth monthly decline in 2026 following an 8.7% full-year loss in 2025. PEY trades at a significant 32% discount to NAV and ranks as the second worst performer in its sector over five years, with a cumulative 13.6% loss for shareholders.
The fund partially mitigated near-term capital pressures through completion of the Clario health tech provider sale (initially announced in November 2025), which returned €23.9m in proceeds and enabled allocation of an additional €18.1m toward share buyback programs, a mechanism to address the persistent NAV discount.
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