Current Pharma M&A Trends

M&A strategies

Two main goals drive most of pharma M&A deals: (a) maintaining a hold on the market while amplifying the current performance, and (b) embracing innovative and disruptive technologies to get ahead of the competition, instead of reinventing the wheel. Fulfilling the first goal calls for a defensive M&A strategy, while chasing the second one needs an offensive strategy.

The followers of defensive strategy prioritise acquisition of assets to fill gaps in the core portfolio, capture synergy for completed transactions, and restore “the balance” in financial statements by restructuring portfolios and divesting non-core assets. Those embracing offensive strategy prefer acquiring disruptive and innovative assets and competitors to enter new-growth segments, accelerating digital transformation, and collaborating with peers.

Based on the findings of “CFO Survey 2021”, the table below shows M&A trends across different sectors. More than half of the CFOs from the LSHC sector give priority to M&A activity – the data indicates an almost equal mix of defensive (55%) and offensive (45%) strategies.