Oncolytics Biotech Inc T.ONC

RE:Biotech M&A is picking back up according to BiopharmaDive

[Noteable]

October 10, 2023 - This summer, large biotechnology deals took a vacation. The dry spell of mergers and acquisitions could be coming to an end, though, if a recent string of buyouts is any indication. 

This activity may serve as fodder to some on Wall Street who’ve been forecasting an uptick in biopharma deals. For instance, analysts at the investment firm Piper Sandler wrote in an Oct. 9 note to clients how they “cannot ignore a number of converging factors” that could accelerate M&A of small- and medium-sized companies “over the next several quarters.” 

Among the various factors, Piper analysts highlighted how the balance sheets of many large drugmakers are at “unprecedented” levels. Pfizer alone had nearly $45 Billion in cash, cash equivalents and short-term investments by early July. And companies like Lilly and Novo Nordisk expect major influxes of cash from their in-demand medicines for obesity. 

Large, splashy acquisitions also may not be as attractive now that the Federal Trade Commission, under the leadership of chairperson Lina Khan, has sought to more closely scrutinize biopharmaceutical tie-ups and the use of patents to impede market competition. 

The Piper analysts noted, too, that big players are under pressure to shore up their businesses since the passing of the Inflation Reduction Act, which created new drug pricing stipulations that could significantly impact some of the pharmaceutical industry’s most lucrative products. 

M&A, therefore, may be a more useful tool for these companies now, allowing them to relatively quickly refill their pipelines and portfolios with new drugs.

https://www.biopharmadive.com/news/biotech-deals-acquisitions-third-quarter-2023/696068/