- In the first three months of 2024, the total
deal value has reached a staggering $43.5 billion. GlobalData reports a remarkable 71% year-on-year increase inmega deals compared to last year- Even in India, the
pharmaceutical sector emerged as a notable standout, with deal values close to one billion.
It has been a roller coaster ride for the biopharmaceutical industry ever since the pandemic-induced surge in 2020. Since last year, the resurgence of mergers and
According to insights from data and analytics company GlobalData, the total deal value surged by an impressive $76.9 billion from 2022 to 2023. And now, in just the first three months of 2024, the total deal value has reached a staggering $43.5 billion. This also marks a remarkable 71% year-on-year increase in mega deals valued at $1 billion or more compared to the same period in 2023, underlining the continued momentum into the first quarter of 2024.
Alison Labya, Business Fundamentals Analyst at GlobalData, underscores the significance of this resurgence, stating, “The recent upturn in biopharmaceutical M&A signals a return in dealmaking confidence, as big pharma companies also look to mitigate challenges such as the Inflation Reduction Act and upcoming patent expirations.”
The pharmaceutical sector, in general, has seen a remarkable surge in deal-making. Even in India, amid the flurry of activity in Q1, the pharmaceutical sector emerged as a notable standout. In April, deal values skyrocketed to a staggering USD 993 million from a mere USD 222 million in March, marking the highest monthly total since November 2023.
This remarkable uptick is attributed to three high-value private equity transactions collectively valued at USD 842 million. Deal volumes also surged by 31% in the sector compared to March 2024, signalling renewed investor confidence and strategic interest in pharmaceutical ventures.
GlobalData’s comprehensive report, The State of the Biopharmaceutical Industry 2024, sheds light on mega
Among the standout deals in Q1 2024 is Novo Nordisk’s Novo Holdings’ acquisition of US-based contract development and manufacturing organization (CDMO) Catalent in February 2024, valued at a staggering $16.5 billion.
Alison highlights the growing interest in specific drug classes, stating, “Companies developing antibody-drug conjugates (ADCs) and radiopharmaceuticals attracted high levels of M&A investment continuing into Q1 2024, as large pharmaceutical companies seek to replenish portfolios with those sought-after drug classes.”
In addition to the Novo deal, Gilead Sciences’ $4.3 billion acquisition of CymaBay Therapeutics, Johnson & Johnson’s acquisition of ADC company Ambrx Biopharma for $2 billion and AstraZeneca’s announcement to acquire US-based radiopharmaceutical company Fusion Pharmaceuticals for $2 billion underscore the strategic pursuit of innovative therapies driving the industry forward.
Oncology emerges as the top therapy area for M&A deals in Q1 2024, with a staggering total deal value of $29 billion, as per GlobalData. However, immunology-focused M&As experienced the largest growth in deal activity compared to Q1 2023, witnessing a remarkable 314% surge in deal value totalling $14 billion.
Looking ahead, Alison concludes, “Q1 2024 saw an increase in billion-dollar M&A transactions involving large biopharmaceutical companies, such as Gilead and Novartis. Given that the biopharmaceutical industry can overcome regulatory challenges set by the Federal Trade Commission, the remainder of 2024 is poised for continued M&A investment from large biopharmaceutical companies, which could accelerate R&D and the launch of innovative drugs.”
As the biopharmaceutical industry navigates through regulatory complexities and market dynamics, the resurgence of M&A activity has been a huge boost for investor sentiments on the industry's resilience and future prospects.