M&A Activity a Favored Prescription for Biopharmaceutical Companies

Global Life Sciences Portfolio Manager Andy Acker discusses how large-cap biopharmaceutical companies utilize M&A strategies to fill product pipelines and maintain steady cash flows.

Key Takeaways

  • 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 additional to their own research and development, large biopharma companies often pursue acquisitions especially for innovative products or franchises with consistent cash flows.
  • With more than $150 billion in free cash flow at the disposal of the 20 largest biopharma companies, we expect M&A to continue to be a driver of shareholder value within the sector.