Pharma M&As Continue, Merck, Sanofi To Buy Cancer Drug Firms
Zacks Investment Research | Dec 09, 2019 08:27PM ET
The year so far has proved to be M&A rich as far as the drug/biotech sector is concerned. There were two mega-merger announcements, Bristol-Myers Squibb-Celgene and AbbVie-Allergan, after relatively dried-up M&A activity in 2018. Smaller biotech research firms investigating new therapies and interesting pipeline candidates garnered attention of bigger players this year. Given that it takes several years and millions of dollars to develop new therapeutics from scratch, large pharmaceutical companies, sitting on huge piles of cash, prefer to buy innovative small/mid cap biotech companies to build out their pipelines. Fast growing and lucrative markets such as oncology and gene therapy have mainly been the focus areas for M&A activities.
Some of these buyouts came at significantly high premiums. Continuing the trend, on Monday, two of the biggest drug giants, Merck (NYSE:MRK) and Sanofi (NASDAQ:SNY) offered hefty premiums to buy small cancer drugmakers to strengthen their oncology pipelines.
On the one hand, Sanofi announced a definitive deal to buy California-based small cancer biotech, Zacks Investment Research
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