Software Validation During Mergers and Acquisitions: Key Risks and Regulatory Considerations

Mergers, acquisitions, and corporate restructuring have a profound impact on the organizational and IT landscape of the companies involved. In regulated environments, these changes can directly affect the validated state of computerized systems used in GxP activities and the integrity of associated electronic records. 

Regulatory authorities such as the U.S. Food and Drug Administration (FDA) and the European Medicines Agency (EMA) expect companies to maintain validated, compliant GxP systems throughout the system lifecycle, including during ownership or structural transitions. Failing to address these risks  can lead to compliance gaps, data integrity issues, and potential inspection findings. 

This article outlines how M&A activities can trigger ERP revalidation after acquisition, identifies typical GxP system transition risk areas, and summarizes practical strategies for maintaining compliance during and after a transition. 

How M&A Impacts System Validation 

During M&A, several conditions can impact the validated state: 

• System ownership and responsibility – System ownership often changes during M&A. A new quality or IT governance structure must clearly define accountability for maintaining validated status, managing user access, and approving changes. Unclear ownership can lead to gaps in validation control. 

• Data migration and consolidation – M&A frequently involves combining or migrating data from legacy ERP or quality systems into a new environment. This process poses data integrity risks if migration activities are not properly validated and documented. FDA and EMA expect evidence of controlled data transfer, reconciliation, and audit trail preservation.

• Infrastructure and hosting changes – Moving on-premise systems to a new datacenter, to cloud providers, or changing hosting arrangements can alter security controls, backup/restore, and disaster recovery - all of which affect validated state.

• Configuration and integration changes – New integrations (e.g., linking ERP and Manufacturing Execution System platforms) can change data flows, business logic, and user permissions. Any change that affects GxP functionality or records requires assessment and possibility revalidation.

• Regulatory history – Any unresolved compliance issues, CAPAs, or inspection findings from the acquired organization remain subject to regulatory oversight after acquisition. 

How to Stay Compliant: A Risk- Based Approach

A risk-based approach to validation during M&A is consistent with FDA, EMA, and other international regulatory bodies’ expectations. The following activities help ensure compliance continuity: 

• Inventory all GxP relevant systems, functionalities, and/or processes. Classify them by criticality and determine which changes may affect validated status.

• Gather validation packages (URS, FS, IQ/OQ/PQ, test scripts, risk assessments) and review CAPA or audit records. Evaluate completeness and alignment with current regulatory expectations. Note any unresolved issues that transfer with the asset.

• For any system subject to data migration, define migration acceptance criteria (record counts, checksums, reconciliation, audit trail capture). Validate migration tools and produce evidence of equivalence or reconciled transformation.

• Perform gap analysis/ impact assessment. Map current validated state to target state and use a risk matrix to prioritize remediation.

• Implement documented change control for each change, with testing proportional to risk and traceable approvals.

• Engage a validation partner like Arbour Group early in the M&A process, ideally during the due diligence or integration planning phase. An experienced validation partner can:    

               - Conduct readiness assessments and validation gap analyses 

               - Advise on data migration strategies and compliance documentation                                 

               - Support requalification, testing, and remediation planning 

               - Help maintain continuity and traceability across systems during transition 

• Prepare a migration/ transfer dossier containing scope, who’s responsible, validation evidence, data reconciliation reports, and residual risk treatment. Regulators expect traceable decisions and documentation.      

Determining the Validation Effort 

Not every change requires complete revalidation. A documented risk assessment should guide the extent of verification or testing: 

• Full Revalidation when intended use, ownership, or infrastructure changes significantly. 

• Targeted Revalidation or Verification when only limited configuration or procedural changes occur, and prior validation evidence remains applicable. 

Regulators accept both approaches if they are justified and well-documented. 

How Arbour Supports Compliance During M&A 

At Arbour, we help life sciences organizations maintain validation integrity while achieving smooth business integration. Our team combines regulatory expertise with deep technical knowledge to ensure that your systems remain compliant, audit-ready, and operational throughout the transition. 

Our M&A Validation Support Services 

• GxP system inventory and risk assessment 

• Review of validation documentation and inspection history 

• Gap analysis and validation impact assessments 

• Data migration validation and reconciliation testing 

• Change management and execution 

• Supplier qualification and contract review 

• SOP development and change control documentation 

• Inspection readiness support and regulatory liaison 

Ensure your business stays audit-ready and fully compliant during mergers and acquisitions. Contact Arbour Group today to learn how our expert validation services can help.