Last year, 2017, saw 2011 deals complete, with Q2 showing the strongest performance with 29.4%, followed by Q1 with 27.6%, Q3 with 24.1% and Q4 with 18.9%
The majority of these deals were in the health and social care subsector with 56.3%, followed by pharma and biotech with 27.3% and medical equipment and supplies with 16.4%.
The dominant country driving M&A activity in 2017 was the US in all three of the subsectors with 54% of deals, followed by Europe at 28.1%, Asia at 9.7% and the rest of the world at 8.2%.
Interestingly, trade led the way with 87% of the healthcare M&A deals in 2017, with private equity making up the balance.
Another key M&A driver was the high level of liquidity in this very hotly contested market, provided by debt and private equity funds.
We believe global M&A activity is being driven by companies wanting to remain competitive by acquiring companies that will provide
The global macros pushing the high demand for healthcare is the
Obviously, there are potential headwinds such as the uncertainty around Brexit and the EU relationship, alongside the ongoing US Trump-factor and the continued geopolitical rhetoric with the Middle East and North Korea.
There’s no doubt these will have a ripple effect on the global market; however we still expect the market to continue to show a similar level of M&A activity in 2018.
Interestingly, the majority of deals in December were in the pharma and biotech subsector, the majority of which were in the biotherapeutics area, defined as any therapeutic materials produced using biological means (for cells, DNA, proteins or vaccines, etc.).
During the last 12 months, we have seen 108 deals in the biopharmaceutical space, a third of the deals during December involving China-based businesses.
The biopharmaceutical industry is a thriving sector in China, forecasted to grow to approximately 15% of GDP in 2030, becoming an important economic growth point. China is moving from a generic market to a global biopharmaceutical market.
The selected deals below capture the activity in the biopharmaceuticals market we observed during the last 12 months, which was driven by access to new technologies and pipeline of new drug developments.
At Clearwater International, we will continue to monitor and analyse the global biopharmaceuticals market, and see if the consolidation in China continues, as we’d expect.