Andy Acker, a Portfolio Manager on the Global Life Sciences Team, discusses how large cap biopharmaceutical companies utilise M&A strategies to fill product pipelines and maintain steady cash flows.
This past week’s acquisition of Allergan by AbbVie is the latest in a string of deals within the sector where the acquirer was willing to pay a substantial premium for a target company.
In addition to undertaking their own research and development, large biopharmaceutical companies often pursue acquisitions especially for innovative products or franchises with consistent cash flows.
With more than US$150 billion in free cash flow at the disposal of the 20 largest biopharmaceutical companies, we expect M&A to continue to be a driver of shareholder value within the sector.
This video was recorded on 28 June 2019.
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