Late last week Bistrol Myers Squibb (BMY US) purchased Celgene (CELG US) for $74bn, paying a 54% premium to the share price. Earlier today Eli Lilly (LLY US) announced that they are acquiring Loxo Oncology (LOXO US) for $8bn, equating to 68% premium. These deals comes back of drug companies announcing drug price increases of between 5-10% for 2019.
Since President Trump took power, he has been rather vocal about drug companies and their prices increases. Most recently on 5th of January he tweeted;
Pharma companies have so far been defiant continuing to raise prices. NBC writes;
Nearly 30 drugmakers have taken steps to raise the prices of their medicines in January, ending a self-declared halt to increases made by a pharma industry under pressure from President Donald Trump
The hikes, as seen in documents viewed by Reuters, will pose a new challenge to Trump’s pledge to lower the costs of prescription medications in the world’s most expensive pharmaceutical market.
With drug companies are less afraid of the administration’s actions, they are pursing m&a again. As mentioned above, two deals have already been announced in the first days of 2019.
One can have a closer look of companies that have been assessed to be potential targets earlier. Below is a list of some potential targets based on Genetic Engineering and & Biotechnology News and various brokers;
Alnylam Pharmaceuticals (ALNY US)
Amneal Pharmaceuticals (AMRX US)
BioMarin Pharmaceutical (BMRN US)
Bio-Rad Laboratories (BIO US)
Bluebird Bio (BLUE US)
Clovis Oncology (CLVS US)
Edward Life Sciences (EW US)
Hologic (HOLX US)
Immunomedics (IMMU US)
Incyte (INCY US)
Intercept Pharmaceuticals (ICPT US)
Nektar Therapeutics (NKTR US)
Neurocrine Biosciences (NBIX US)
Penumbra (PEN US)
Qiagen (QGEN US)
Sarepta Therapeutics (SRPT US)
Seattle Genetics (SGEN US)
Tesaro (TSRO US)
Vertex Pharmaceuticals (VRTX US)
Bloomberg notes that AbbVie (ABBV US), Gilead (GILD US), Merck (MRK US) and Amgen (AMGN US) could all be acquirers. JP Morgan yearly pharma conference happening this week were companies could give further color on how the see the space and potential m&a landscape. Plenty of big pharma companies are cash-rich, with a combined over several hundred billion dollars of firepower for m&a. Recent deals could be the trigger point for more deals to come.