The pharma and healthcare sector increased their attractiveness for capital. Global M&A volume increased in the second half of 2020 to total nearly $97 billion, according to a report from PwC. Activity in the pharma and healthcare sector in the second half was up 25% compared to the first half of the year and was 14% higher compared to 2019 as a whole.
Pharma and healthcare have gone from being a sector of refuge during times of economic downturn or recession to a protagonist. In this period, AstraZeneca acquired the U.S. pharmaceutical company Alexion for $39 billion, Gilead Sciences bought the cancer therapy developer Immunomedics for $21 billion and Siemens Healthineers is in the process of buying the U.S. Varian Medical Systems for $16.4 billion.
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Bristol Myers Squibb acquired the biopharmaceutical company MyoKardia for $13.1 billion
Johnson&Johnson bought the biotech company Momenta Pharma for $6.5 billion. Excluding the mega-deals, the total value of the deals is slightly below pre-pandemic figures, according to PwC. The number of mergers and acquisitions increased mainly in Asia in the second half of the year. Deals in medical devices rose by 35%, in the biotech sector by 75%, and in pharmaceuticals by 36% compared with the first half. In Europe, the Middle East, and Africa, the number of deals fell by 2%, while in the Americas it was down 22%, although the amounts were higher. Interest in Medtech, medical technology, and laboratory companies also increased as a result of the demand generated by the pandemic.
In 2021 there will be a greater number of integration operations between large operators of nursing homes
The combination of strong investor demand, a shortage of available assets and an abundance of liquidity is the perfect recipe that is driving the value of companies in the sector and will continue to do so in 2021, according to the consultancy.
In the pharmaceutical industry, mid-sized biotech companies along with companies specializing in the development and manufacture of medicines for third parties are the most attractive. Also companies related to medical devices, vaccines, therapies and diagnostics related to the fight against COVID-19 and its variants. Regarding the healthcare sector, private clinics and hospitals will lead in consolidation deals, digital healthcare service providers and IT companies will be in focus and there will be an increased number of integration deals between large nursing home operators.
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