Data for the this analysis was compiled using the DealForma database on deals. We applied initial filters for mergers and acquisitions, target company types, therapeutic areas, company stage at acquisition, and deal payment terms. From there, we exported the data to Excel and used pivot tables and charts to do the rest. All data are based on publicly disclosed figures. We invite you to answer interesting questions on M&A and partnership trends using our data and carefully curated profiles on deals, pipelines, companies, funding, and business executives by visiting dealforma.com to schedule your personalized demo.
Life Sciences M&A started with a bang in 2019 with one of the biggest deals to date – Bristol-Myers Squibb will acquire Celgene in a $74 billion cash and stock transaction that represents a 54 percent premium to Celgene’s closing price ahead of the announcement (see DealForma’s synopsis below). The deal joins two powerhouse oncology companies and comes as Celgene has seen its market cap drop more than $60 billion over the past year and a half.
It is more than likely to be the talk of the town at the annual dealmaking J.P. Morgan Healthcare Conference, and there will be much speculation over whether 2019 will follow 2018 as a good year for life sciences M&A. Several catalysts that have spurred recent transactions – a strong venture capital and private equity investment climate, large fundraisings, an emphasis on innovation, and continued pharma restructuring around core businesses – are expected to continue in the new year.
We mined DealForma’s extensive database for historical M&A trends to get an idea of what might lie ahead. After two quiet years, M&A deals of biopharma therapeutics and platforms, diagnostics, and medical device companies surged more than 50 percent in 2018 to 154 deals valued at $148 billion in disclosed deal values.
Last year also started off with a bang with $33.9 billion in announced M&A deals in January alone. Among the largest deals, Celgene acquired privately-held Impact Biomedicines during JPM week for $1.1 billion cash up front for its late-stage myelofibrosis drug fedratinib and up to another $5.9 billion based on achievement of various milestones. Celgene followed that deal with the buyout of Juno Therapeutics for $9 billion for its immunotherapies in mid-stage development. And Sanofi acquired Biogen’s late-stage gene therapy spinout Bioverativ for $11.6 billion.
Then in May 2018, Japanese pharmaceutical Takeda said it would acquire rare disease specialist Shire plc for $62 billion.
Early-Stage Company Acquisitions
Though all of these acquisitions involved companies with later stage and marketed therapies, the trend for life sciences M&A has moved towards earlier-stage company acquisitions since 2011. In 2018, 30 percent of acquired companies were preclinical, discovery-stage, and platforms; 50 percent had a compound in the clinic, and 20 percent had an approved product.
Genentech’s acquisition of Jecure Therapeutics, Roche’s buyout of Inception5, Janssen Biotech’s deal for BeneVir Biopharm, and Astellas Pharma’s acquisition of Potenza Therapeutics were among the transactions announced in 2018 for public and private companies at the earliest stages of development.
While financials were not disclosed for many of the early-stage deals, analysis of private and public biopharma company deal values finds that averages rose to $471 million for private companies at the preclinical stage, increasing 133 percent above the average value in 2017.
Overall average deal values for private company acquisitions rose to $845 million in 2018, a 217 percent jump over 2017 values.
Want data for your analysis? Want us to do it? Subscribers get both.
Schedule your demo of the DealForma database to see how we help you get better reports done faster.
Specifically for Biotech, Pharma, Device, and Diagnostics
Public M&A Premiums
For public companies, premiums have been increasing steadily over the past ten years, with infectious disease therapeutics developers’ share premiums at the top as far as what acquirers are willing to pay. Oncology companies, always in demand, came in second.
Top M&A Buyers
As the distinction between pharma and biotech continues to blur, most of the top buyers in 2018 continue to be large pharmaceutical companies looking for innovation outside their organizations. But several biotechs, including Celgene, Alexion, and Emergent BioSolutions also made the list last year.
It will be interesting to see how 2019 progresses as one of the largest biotechs gets swallowed up. More than $20 billion flowed into private health-related life sciences companies in 2018, including many large launch/Series A rounds, and it shows no signs of slowing down. In the public sector, however, biotechnology company share prices are down almost 25 percent since their high in August, so it might be the perfect time to snatch up a public company.
Marie Daghlian is a freelance writer and editor who reports on the business of biotechnology and healthcare technologies and on rare diseases for Global Gene’s Rare Daily. She also covers the industry for Big4Bio, a daily newsletter focused on the four major biotech centers in the United States.
More Research by DealForma
Top Biopharma Deal July 2021: Arvinas – Pfizer ARV-471 PROTAC Protein Degrader for ER+/HER2- Breast Cancer
The top biopharma deal upfront for July 2021 was Arvinas and Pfizer’s partnership for PROTAC protein degrader ARV-471 ER+/HER2- breast cancer. Arvinas will receive $650M in cash up front, $350M in an equity investment, and is eligible to receive up to $1.4 billion in milestones, plus a 50% cost and profit split.
The top biopharma deal upfront for June 2021 was iTeos and GSK’s partnership for anti-TIGIT mAb EOS-448. iTeos will receive $625M up front, up to $1.45B in milestones, a U.S. profit split and ex-U.S. tiered royalties.
Top Biopharma Deal May 2021: Agenus – BMS for AGEN-1777 Bispecific Anti-TIGIT Antibody for Non-Small Cell Lung Cancer
The top biopharma deal upfront for May 2021 was Agenus and BMS’ partnership for anti-TIGIT mAb AGEN-1777. Agenus will receive $200M up front.
Top Biopharma Deal April 2021: CRISPR – Vertex for CTX001 for Sickle Cell Disease and Transfusion-Dependent Beta-Thalassemia
CRISPR Therapeutics and Vertex Pharmaceuticals amended their 2015 deal to develop and commercialize gene editing therapies. This expansion is for Phase I/II CTX001 for severe sickle cell diseases and transfusion-dependent beta-thalassemia. CRISPR will receive $900M up front, up to $200M in milestones upon the first regulatory approval, and a cost/profit split of 40%.
Debiopharm granted Merck exclusive, worldwide rights to develop and commercialize Xevinapant in Phase III for advanced squamous cell carcinoma of the head and neck. Debiopharm will receive EUR188M ($227M) up front and is eligible for up to EUR710M ($856M) in milestones, plus royalties. This was the largest upfront cash and equity for a partnership signed in March 2021.
Biotech and pharma deals in 2020 soared to an all-time high of 1,154 signed deals with $146.3 billion in total value, defying expectations that the global Covid-19 pandemic would hamper dealmaking. Global healthcare and life sciences R&D partnership activity was up 23 percent over 2019 and total deal values rose 31 percent from the previous year, driven in part by advances in technological and molecular understandings of disease pathways, and a drive toward targeted precision medicines.
Vir Biotechnology and GSK expanded their partnership with a new deal to develop VIR-2482 and mAbs for influenza. This was the largest upfront cash and equity for a partnership signed in Feb. 2021.
Biotech and pharma M&A total deal values slumped in 2020, despite an active year in life sciences dealmaking, with no big standout biopharma deals until late in the second half of the year. We look at the extensive DealForma database to see how life sciences M&A activity shaped up in 2020 in more detail.
This article is a sample from the DealForma Annual Deal Trends Report provided to database subscribers. Data for this analysis was compiled using the DealForma biopharma deals database. We applied initial filters for mergers and acquisitions, therapeutic areas, asset...
Over the last three years, there have been eight M&A deals for companies developing advanced first generation and next gen cancer cell therapies. Six of them have been completed to date.
You met on Zoom. Now it's Deal Time.
With thousands of company profiles and a decade of deals specifically in biopharma and medtech, you'll take the guesswork out of deal comps. Schedule your customized demo to see how DealForma helps you win that term sheet with better data.