Upward Trajectory For Biotech/Pharma M&A: Sector Trends Towards Pre-Pandemic Levels, Forecasts Positive For 2024

AbbVie, Inc. +1.06%
ASTELLAS PHARMA 0.00%
Biogen Inc. +2.03%
BLACKROCK FUTURE HEALTH ETF -0.47%
Bristol-Myers Squibb Company +1.30%

AbbVie, Inc.

ABBV

166.41

+1.06%

Biogen Inc.

BIIB

194.38

+2.03%

BLACKROCK FUTURE HEALTH ETF

BMED

24.03

-0.47%

Bristol-Myers Squibb Company

BMY

48.93

+1.30%

ASTELLAS PHARMA

ALPMY

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According to the Global Data report, the pharma sector in Q3 2023 witnessed deals worth $28 billion, down 28% from the $54 billion recorded in Q2 2023. 

Deal volume fell 9% from 242 deals in Q2 2023 to 221 M&A deals in Q3 2023.

PricewaterhouseCoopers wrote in its Pharmaceutical and Life Sciences: U.S. Deals 2024 Outlook. "As regulators' perspectives on key deal factors become better understood, there may be a return of larger deals, along with continued interest in the $5 billion to $15 billion deals to fill targeted strategic gaps."

"Despite some stabilization in the macroeconomic environment and the potential for a soft landing in sight, continued geopolitical and regulatory uncertainty seems a given in 2024," PWC added in its report.

The pharmaceutical and life sciences sector experienced a notably robust year in 2023, nearing pre-pandemic levels in both M&A deal value and volume, the PWC report added. 

Anticipations for 2024 suggest continuing this trend, projecting comparable activity levels within the range of $225 billion to $275 billion across all subsectors.

Notable Deals in 2023

  • Pfizer Inc (NYSE:PFE) acquired Seagen Inc (NASDAQ:SGEN) for $43 billion.
  • Bristol Myers Squibb & Co (NYSE: BMY) agreed to acquire Karuna Therapeutics Inc KRTX for $330.00 per share in cash, for a total equity value of $14.0 billion, or $12.7 billion net of estimated cash acquired
  • Merck & Co (NYSE:MRK) acquired Prometheus Biosciences for $200.00 per share in cash for a total equity value of ~$10.8 billion.
  • AbbVie Inc (NYSE:ABBV) to acquire ImmunoGen Inc (NASDAQ:IMGN) and its flagship cancer therapy Elahere, for $31.26 per share in cash. The transaction values ImmunoGen at a total equity value of approximately $10.1 billion
  • AbbVie Inc (NYSE:ABBV) will acquire psychiatric and neurological disorders player Cerevel Therapeutics Holdings, Inc (NASDAQ: CERE) for $45 per share in cash with a total equity value of approximately $8.7 billion.
  • Biogen Inc (NASDAQ: BIIB) agreed to acquire Reata Pharmaceuticals Inc (NASDAQ: RETA) for $172.50 per share in cash, reflecting an enterprise value of approximately $7.3 billion.
  • Bristol Myers Squibb & Co (NYSE: BMY) agreed to purchase Mirati Therapeutics Inc (NASDAQ: MRTX) at $58.00 per share in cash, amounting to an overall equity valuation of $4.8 billion, with an additional Contingent Value Right at $12.00 per share in cash, offering an extra $1.0 billion in value opportunity.
  • Japanese healthcare company Astellas Pharma Inc (OTC: ALPMY) has agreed to buy Iveric Bio Inc (NASDAQ: ISEE) for $40.00 per share in cash for a total equity value of approximately $5.9 billion.
  • Most recently, Bristol Myers Squibb & Co (NYSE: BMY) has agreed to acquire RayzeBio Inc (NASDAQ: RYZB) for $62.50 per share in cash, for a total equity value of approximately $4.1 billion, or $3.6 billion net of estimated cash acquired.
  • Image by Steve Buissinne from Pixabay
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