Factbox: Who is next in big pharma's merger spree?
Reuters
Published Aug 20, 2019 00:05
Factbox: Who is next in big pharma's merger spree?
(Reuters) - Consolidation in the U.S. healthcare industry, which has already witnessed a string of multi-billion dollar deals, is expected to remain a major theme for the rest of 2019.
Bristol-Myers Squibb's (N:BMY) $74 billion (£60.9 billion) acquisition of Celgene set the M&A ball rolling in January, and was followed by AbbVie Inc's (N:ABBV) $63 billion bid for troubled smaller rival Allergan Plc (N:AGN).
Regulators are pressuring companies to cut drug costs and takeovers have become the preferred method of combating looming patent expiries on some of the top-selling medicines they have relied upon in recent years.
Following is a list of big healthcare companies and their recent deals and possible future acquisitions.
BIOGEN INC (O:BIIB):
- Since the halt in its development of a promising Alzheimer's therapy wiped $18 billion off Biogen's stock in March, Wall Street has been calling on the company to beef up its drug development pipeline through acquisitions.
- Possible deals would give the company access to drugs for lucrative therapeutic areas such as Duchenne muscular dystrophy and depression.
- Recent deal was the $877 million buyout of gene therapy developer Nightstar Therapeutics, and as of June 30 the company still had cash reserves of almost $2 billion.
ELI LILLY AND CO (N:LLY):
- Lilly spun off its animal health unit earlier this year, and has reiterated its commitment to making bolt-on acquisitions to diversify its portfolio, as its long-term top-sellers Humalog and Cialis face intensifying competition.
- Company has also been focusing on cancer drug development and its $8 billion buyout of Loxo Oncology helped it delve deeper into the lucrative business.
- The company reported $2.29 billion in cash and cash equivalents as of June 30.
PFIZER INC (N:PFE):
- The world's largest drugmaker has repeatedly said it would steer clear of large scale M&A, citing confidence in its own drug pipeline. But in April it said it would look at bolt-on deals worth "a few" billion dollars to complement its pipeline
- The spin-off and merger of its consumer healthcare unit with GlaxoSmithKline Plc (L:GSK), as well as its off-patent branded drugs business has simplified the company's business structure.
- Analysts say that may still leave room for smaller deals like its $10.6 billion buy of Array Biopharma, which boosted its arsenal of oncology drugs and set the stage for the company to become a leader in colon cancer treatments.
- Shares of the company are down 20.6% so far this year.
AMGEN INC (O:AMGN):
- A recent U.S. court ruling win on Amgen patents for rheumatoid arthritis drug Enbrel is seen as having left the company free to pursue business development plans, including M&A.
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- The drugmaker said previously it would look for both big and small deals to push deeper into areas like cancer and metabolic disorders, where it already has a firm footing.
- Analysts have also suggested buying Celgene Corp's (O:CELG) psoriasis drug Otezla, which Bristol-Myers Squibb Co (N:BMY) is looking to sell in order to allay antitrust concerns.
- Amgen had $5.53 billion in cash and cash equivalents as of June 30. Shares of the company are up nearly 5% this year.
MERCK & CO INC (N:MRK):
- Investors have raised concerns about Merck's (N:MRK) increasing dependence on blockbuster cancer drug Keytruda, highlighting the need for the drugmaker to engage in M&A.
- The company has said it would focus on bolt-on deals rather than a large, transformative acquisition.
- War chest stood at $6.7 billion in cash and cash equivalents, as of June 30 with shares up nearly 11.3% this year.
GILEAD SCIENCES INC (O:GILD):
- CEO Daniel O'Day has raised expectations for consolidation since taking the helm in March, prioritising pipeline diversification and announcing a $5.1 billion investment in Belgo-Dutch biotech Galapagos NV (AS:GLPG), which pushed deeper into areas such as fibrosis and arthritis.
- California-based Gilead had cash and cash equivalents of $11.24 billion as of June 30. Shares up about 1% this year.
For an interactive graphic, click here https://tmsnrt.rs/2NkQkQX
(This story has been refiled to correct spelling of Gilead in subheading)
Written By: Reuters
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