A recent survey suggests that 2015 will set a new record for mergers and acquisitions and licensing of biopharmaceutical assets, according to the survey of biopharmaceutical dealmakers by Campbell Alliance, the consulting firm of inVentiv Health. The survey also revealed early signs of a potential slow-down in licensing of assets.
This is the seventh year that Campbell Alliance has surveyed dealmakers to provide a forward-looking glimpse of what the rest of the year will hold and identify areas of greatest opportunities for buyers and sellers.
The level of dealmaking activity last year was the highest it has been since 2009 and activity in 2015 is set to surpass it. But this time, M&A activity is being fueled by small and mid-cap biopharma buyers, who are flush with cash.
Key Findings from Dealmakers’ Intentions 2015
- The narrowed discount rate gap to historic norms has removed a temporary bridge between optimistic sellers and pessimistic buyers.
- A seller’s market exists for Phase III CNS, preclinical and Phase III oncology and Phase III women’s health assets.
- A buyer’s market exists for preclinical respiratory, women’s health and ophthalmology assets.
- Hot areas/technologies of interest are largely linked with oncology as buyer demand within the therapeutic area remains high.
- High-interest, oncology-related technology includes cancer vaccines, antibody drug conjugates, personalized medicine and immuno-oncology.
- Innovation has gravitated toward oncology in which pricing and access risk is relatively low. Trial costs and length similarly are low versus other therapeutic areas.
- The conversion rate for deals has steadily increased over the past few years, which is a reflection of the robust dealmaking environment. This dealmaking environment has created bandwidth constraints in the evaluation of deals for buyers.
A full report is available at inVentivHealth.com/CampbellAlliance/Dealmaker.