US leads M&A activity in pharmaceuticals to $2.4 trillion high over ten years

08 March 2017 Consulting.us

Pharmaceutical industry spending on mergers and acquisitions has soared to more than $2.4 trillion in the past decade. The industry now accounts for 9% of global M&A deal activity.

Globally, and in North America, the mergers and acquisitions (M&A) market has consolidated its recovery following the financial crisis. In 2016 worldwide M&A activity impressed with a total value of $3.2 trillion, down on 2015’s bumper $3.96 trillion but still marking one of the best years in the past decade.

The US and Canada accounted for almost $1.5 trillion, or 47.5% of global M&A activity, according to data from Mergermarket. Almost 5,000 deals from a worldwide total of 17,000 took place in North America. Only in 2015 was a better performance recorded in the region, with $1.9 trillion of activity spread across almost 5,300 deals. 

Flaunting a large number of mega-deals, the pharmaceutical industry has been at the center of robust M&A activity, both in the US and globally. With the medical and biotechnology sectors under the pharmaceutical umbrella, on average the industry accounted for 8.75% of the total M&A market over the past ten years. In 2009 pharmaceutical industry contributions to global M&A activity reached a share of 13.% ($227.7 billion). In 2013 this rose to $379.9 billion despite the relative share falling to 11.7%.

Value of pharmaceuticals M&A globally

In 2015 M&A activity in the North American pharmaceutical sector dropped slightly but still made up almost $300 billion of the worldwide total of $392.4 billion - the highest figure in ten years. Pharmaceutical contributions to global M&A activity haven’t been as strong from the US and Canada in 2016, totalling a combined $177 billion. This still towered over the $57 billion raised in Europe, which more than doubled its value from 2015. A Japanese mega-deal - Canon bought Toshiba Medical Systems Corporation for $5.9 billion - saw Japan’s pharmaceutical M&A value leap from $2.9 to $7.3 billion in 2016.

Value of M&A in the gloabl pharma industry - by-region

Mega mergers

Such mega-deals are central to the pharmaceutical world’s M&A activity, especially in the US. Last year the acquisition of Baxalta by Irish outfit Shire for $35.2 billion was the fifth largest US-based M&A deal. The biggest pharmaceutical M&A in history also took place on American soil - in 1999 Pfizer acquired Warner Lambert for $84.3 billion. The American giant is also in the record books for the 2002 $63.8 billion purchase of Pharmacia and the 2009 acquisition of Wyeth for $48.9 billion.

The 10 largest transactions in the pharma industry

Among the top ten pharmaceutical mega-deals, six have taken place in the past decade. The 2016 takeover of Monsanto by German chemical giant Bayer or $58.2 billion stands out as the largest since French pharmaceutical multinational Sanofi merged with Aventis in 2004.

The US features prominently on the list with American company Allergan making two appearances, alongside US-based Abbvie and Merck & Co. In January 2017 the 13th largest pharmaceutical M&A deal in history saw Johnson & Johnson acquire Actelion for almost $30 billion.

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Defined Health rebrands as Cello Health BioConsulting

15 November 2018 Consulting.us

18 months after joining Cello Health, US biotech consultancy Defined Health has been rebranded as Cello Health BioConsulting. The arm, which focuses on pharma and life sciences biotechnology, will operate within Cello Health’s consulting business unit – Cello Health Consulting.

London-based Cello Health offers research, communications, and advisory services to clients in the pharmaceutical, biotechnology, and health sectors. Its Cello Health Consulting division offers strategy consulting services to healthcare clients – with offerings ranging from early asset development and commercialization to competitor strategy. Cello Health Insight, meanwhile, focuses on market research, and has worked with every pharma company in the Global Fortune 500. Finally, Cello Health Communications creates compelling brand communications and engagement strategies to support clinical and commercial success.

The company has US offices in New York, Chicago, San Francisco, Philadelphia, and Yardley, PA, and UK offices in London and Farnham. Cello Health employs over 500 researchers, scientists, and strategists in Britain and the United States.Cello Health BioConsultingNow, the company has announced that it is rebranding Defined Health – a New Jersey-based consultancy focusing on early stage biotechnology – to Cello Health BioConsulting. Acquired 18 months earlier, the company name change reflects the increased alignment of strategic, scientific, and consulting resources that has taken place since Defined Health joined Cello Health in 2017.

Founded in 1983, Defined Health offers business development strategy services to life sciences firms focusing on biotech – which fights diseases and health risks through the harnessing of cellular and biomolecular processes. The team’s in-depth experience bridges clinical practice, drug development, business development, and commercial strategy, with strong expertise in oncology, rare diseases, and neuroscience, among others.

Now, operating as Cello Health BioConsulting, the former Defined Health team is enhanced by a synergistic relationship with Cello Health Consulting’s strategic marketing and commercial expertise.

"Ultimately, it is our people that our clients value, and we are not going to disrupt the client-driven approach that the Defined Health team has always delivered," said Ginger Johnson, CEO of Defined Health. "Cello Health BioConsulting will continue to be led by the same established senior leadership team operating from Florham Park, NJ.”

“As part of the Cello Health Consulting capability, our clients will now have access to over 80 consultants globally, with a unique combination of deep scientific sophistication and relevant strategic and commercial insights through senior industry and consulting expertise."

According to the company, the pharma and life sciences industry is evolving rapidly, and science-driven biotechs need to consider commercial implications early in the development cycle. "Given the trend toward compressed timelines from discovery to approval, an increasing focus on smaller patient populations, and the need for biotechs (as well as large Pharma) to navigate the fine line between scientific and commercial risk, we believe that our clients, even the most science-driven biotechs, now need to consider commercial issues early on and will benefit from the unique combination of scientific, strategic and commercial expertise we will now deliver,” said Ed Saltzman, Executive Chairman and Founder of Defined Health.