Biopharma M&A activity scaled record highs in 2019, with a few mega mergers announced involving names such as Bristol-Myers Squibb Co BMY, Roche Holdings AG Basel ADR RHHBY and AbbVie Inc ABBV.
It's feared that the frenetic pace of M&A in the sector could slow down in the coming year.
Yet there are fundamental reasons to think otherwise: there could at least be many more bolt-on acquisitions as companies, especially cash-rich big pharma companies with an ageing pipeline, strive to reinvigorate slowing growth.
The upcoming year is likely to see many hostile deals, Evaluate Pharma reported, citing Steven Slaughter, managing director of Manulife Investment Management.
"There are enough interesting targets where management teams don't want to sell, but in the large-cap world balance sheets are becoming so large they just have to deploy some capital," Slaughter was quoted as saying at the Jefferies Healthcare Conference.
Increased scrutiny by regulators could serve as a dampener. In 2019, the FTC made several second requests, requiring additional information for vetting M&A transactions.
10 Biotech M&A Targets For 2020
The following are potential targets that could find themselves in the M&A mix in the coming year.
- Gene editing company Crispr Therapeutics AG CRSP is speculated to be a potential target for Vertex Pharmaceuticals Incorporated VRTX, given the licensing agreement in place between the companies. Incidentally, Vertex itself is considered an M&A target.
- Alnylam Pharmaceuticals, Inc. ALNY, which has the first-ever FDA-approved RNAi therapeutic in Onpattro, is also a potential M&A target. Analysts single out Sanofi SA SNY as the likely pursuer, given the stake it has in Alnylam. It should be noted here that Sanofi recently agreed to buy Synthorx Inc THOR for $2.5 billion.
- Amarin Corporation's AMRN attraction as an M&A target has increased following the FDA nod for an expanded indication for its fish oil pill Vascepa.
- Incyte Corporation INCY, which has a blockbuster commercial product in Jakafi.
- Global Blood Therapeutics Inc GBT, which recently received the FDA nod for its sickle cell disease treatment Oxbryta
Several gene therapy companies are discussed as M&A prospects. Notable among them are:
- Uniqure NV QURE.
- Sarepta Therapeutics Inc SRPT. Following the recent licensing agreement with Roche, the probability of an outright sale has fallen.
- Regenxbio Inc RGNX
- Solid Biosciences Inc SLDB
- BioMarin Pharmaceutical Inc. BMRN
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