ΕΡΕΥΝΑ EY
- 30 Apr 2023
- economy
Global mergers and acquisitions (M&A) investments in the health sciences sector totaled $105 billion in the first 11 months of 2022, with the total value down significantly from 2021, according to the 11th edition of the annual report by EY, M&A Firepower 2023.
However, at the end of the year, there was a sharp increase, with Johnson & Johnson and Amgen making multibillion-dollar acquisitions. Industry shows record levels in EY report Investment "firepower" – defined as a company's ability to undertake M&A based on the strength of its balance sheet – is at historic highs, yet most companies have chosen not to move in 2022.
The health sciences industry's generally cautious stance follows broader global deal trends, with an overall decline in R&D investment in 2022 globally, reflecting the uncertainties of macroeconomic volatility, and fueled by ongoing geopolitical tensions.
Research by EY has found that, in the first 11 months of the year, the value of biotech and pharmaceuticals (Biopharma) M&E fell by 42% compared to 2021, with Pfizer's acquisition of Biohaven for 10.6 billion .dollars to be the largest deal by December 2022. Alliances remain an important focus of industry and corporate M&E strategies. But Amgen's announcement in mid-December that it would pay more than $28 billion for HorizonTherapeutics is perhaps a signal that the industry is ready to return to big deals in 2023.
The medical technology (MedTech) industry is facing headwinds such as staffing shortages occurring across the healthcare sector, rising costs and cutbacks in medical device supplies leading to a 62% drop in R&D value in 2022. Following an outstanding 2021 performance for the MedTech sector's R&D, the fourth quarter of 2022 contributed to a significant increase in overall deal value in the sector, with Johnson & Johnson's acquisition of Abiomed, a cardiac rehabilitation company, for $16.6 billion, representing approximately 42% of MedTech's total R&D spending this year.
