Beyond Borders: Global biotechnology report 2010
Beyond Borders: Global biotechnology report 2010
Beyond Borders: Global biotechnology report 2010
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Without Roche-Genentech, the value of<br />
M&A transactions involving US-based<br />
biotech companies decreased by half in<br />
2009 to a total of US$14.1 billion. Only<br />
US M&As, 1999–2009<br />
Value (US$b)<br />
Pharma-biotech megadeals<br />
35<br />
30<br />
25<br />
20<br />
15<br />
10<br />
5<br />
Pharma-biotech<br />
0<br />
1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009<br />
Source: Ernst & Young, Windhover Information, MedTRACK, BioWorld and company news via NewsAnalyzer<br />
Chart excludes Roche’s acquisition of Genentech.<br />
US strategic alliances remain strong<br />
Potential value (US$b)<br />
Pharma-biotech<br />
35<br />
30<br />
25<br />
20<br />
15<br />
10<br />
5<br />
0<br />
Biotech-biotech<br />
three transactions had a value in excess<br />
of US$1 billion. Dainippon Sumitomo<br />
Pharmaceuticals of Japan acquired<br />
Sepracor for US$2.6 billion, extending<br />
Biotech-biotech<br />
Biotech-biotech megadeals<br />
1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009<br />
Source: Ernst & Young, Windhover Information, MedTRACK, BioWorld and company news via News Analyzer<br />
Chart shows potential value, including up-front and milestone payments, for alliances where deal terms are publicly disclosed.<br />
82 <strong>Beyond</strong> borders <strong>Global</strong> <strong>biotechnology</strong> <strong>report</strong> <strong>2010</strong><br />
the trend of Japanese companies growing<br />
their operating footprint in the US through<br />
acquisition (see Eisai’s acquisition of MGI<br />
Pharma in 2007 and Takeda’s acquisition<br />
of Millennium Pharmaceuticals in 2008).<br />
Bristol-Myers Squibb deepened its<br />
<strong>biotechnology</strong> capabilities through the<br />
acquisition Mederex for US$2.4 billion.<br />
Meanwhile, Gilead Sciences played white<br />
knight to CV Therapeutics after Astellas<br />
Pharmaceuticals’ hostile bid, paying US$1.4<br />
billion to win over shareholders. Astellas<br />
is clearly interested in expanding its US<br />
presence and in early <strong>2010</strong> returned with<br />
another hostile bid — its US$3.5 billion offer<br />
for OSI Pharmaceuticals. The next largest<br />
acquisition in the US was the US$970<br />
million that Johnson & Johnson paid for<br />
Cougar Biotechnology which was developing<br />
several oncology drugs, including one in<br />
Phase III.<br />
Together, these four transactions comprised<br />
54% of total M&A deal values, including the<br />
value of CVRs. In total, there were only 17<br />
acquisitions of US companies in which the<br />
value changing hands at closing, exclusive<br />
of CVRs, exceeded US$100 million, down<br />
from 23 in 2008. These transactions had an<br />
aggregate value of US$11 billion, well below<br />
2008’s US$29.6 billion.<br />
Alliances<br />
In 2009, US-based biotech companies<br />
entered 132 alliances where financial<br />
terms were disclosed (up slightly from 115<br />
deals in 2008). These transactions had<br />
an aggregate potential value of US$27.3<br />
billion (similar to the prior year’s US$29.6<br />
billion). Of these deals, 97 disclosed upfront<br />
payments, comprised of license fees,<br />
technology access fees and sales of equity,<br />
with a combined value of approximately<br />
US$3 billion — essentially unchanged since<br />
2008. The average up-front in 2009 was