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Bridge over troubled water
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Pharmaceutical M&A
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FEW industries have been shaped more by mergers and takeovers than pharmaceuticals. This is because developing drugs is such a high-risk business. Most potential medicines either fail to reach the market, or fail thereafter to recoup the cost of developing them. If a company does not have enough promising drugs in its research pipeline, its most obvious route to growth is to buy another firm. So, many of the world’s biggest drugmakers, such as Pfizer, Merck and GlaxoSmithKline (GSK), have been built through a succession of deals.
However, something has changed in the nature of drug firms’ dealmaking over the years. It used to be all about achieving sheer scale, and building a broad portfolio of potential treatments for a range of illnesses. Now it is increasingly about drug companies concentrating on what they do best, and getting out of areas in which they are weak. There is evidence that this is a better …Original Article
