Thursday 11 April 2013, Amsterdam
Our “Pharmaceutical & Healthcare Annual Deals Analysis: M&A and Investments Trends -2012” report is an essential source of data and trend analysis on partnerships, licensing, mergers and acquisitions (M&A) and financing in the pharmaceutical and healthcare market. The report provides detailed information on Partnerships, Licensing Agreements, M&As, Equity/Debt Offerings, Private Equity and Venture Financing transactions registered in the pharmaceutical and healthcare industry in 2012. The report presents detailed comparative data on the number of deals and their value in the past five quarters categorized into deal types, segments, and geographies. Additionally, the report provides information on the top venture capital and advisory firms in the pharmaceutical and healthcare industry.
Value Of Pharmaceutical and Healthcare Deals Increased In 2012
The pharmaceutical and healthcare industry recorded an increase in deal values with companies in the industry focusing on enhancing their product portfolio through acquisitions, partnerships and licensing activity. In 2012, the industry reported deals worth $312.6 billion, as compared to $301 billion in 2011. However, the number of deals declined to 4,312 in 2012 from 4,414 in 2011. Oncology therapeutics market continues to be choice of investors in 2012. It recorded 909 deals in 2012.
Abbott Laboratories, a global healthcare company, completing private placement of senior notes for gross proceeds of $14.7 billion through its wholly-owned subsidiary AbbVie Inc.; Nestle S.A., a nutrition, health and wellness company, completing the acquisition of Pfizer Nutrition, an infant nutrition business unit of Pfizer Inc, for a purchase consideration of $11,850m in cash and F. Hoffmann-La Roche Ltd. (Roche), a pharmaceutical and diagnostic company, revising its offer price to acquire Illumina, Inc., a molecular diagnostic company, to $66 per share in cash, are some of the high value deals reported in 2012.
GlaxoSmithKline, a company with focus on the development, manufacture and commercialization of pharmaceutical and consumer health related products, topped the table of deal makers by participating in39 deals worth $12.4 billion in 2012.
Number Of M&As Declined In 2012
Mergers and acquisitions (M&As), including asset transactions, reported a decline in the number of deals in 2012 with 1,111 deals, as compared to 1,155 deals in 2011. However, the deal values increased to $144.9 billion in 2012 from $139.4 billion 2011. The value of deals increased in 2012 with pharma companies showing inclination to acquire companies and products in order to overcome challenges raised due to patent expiries. In 2012, 25 deals exceeded $1 billion value. Out of 1,111 deals reported in 2012, there were 663 acquisitions worth $130.6 billion, 420 asset transactions worth $14.3 billion and 28 mergers. Much of the M&A activity in 2012 occurred in central nervous system therapeutics market, whichreported 88 deals worth $18.9 billion.
Nestle S.A., a nutrition, health and wellness company, completing the acquisition of Pfizer Nutrition, an infant nutrition business unit of Pfizer Inc, for a purchase consideration of $11,850m in cash; F. Hoffmann- La Roche Ltd. (Roche), a pharmaceutical and diagnostic company, revising its offer price to acquire Illumina, Inc., amolecular diagnostic company, for a purchase consideration of $66 per share in cash, which values the transaction between $8,100m to $8,200m and Aetna Inc., a provider of health care services, receiving shareholders’ approval to acquire Coventry Health Care, Inc., a diversified managed healthcare company, for a purchase consideration of $7,300m, are some of the high-value transactions announced in 2012.
Valeant Pharmaceuticals International, Inc.; IPC The Hospitalist Company, Inc.; Aviv REIT, Inc.; The Ensign Group, Inc. and Health Care REIT, Inc. were some of top buyers in 2012.
Value In IPO Market Shows Signs Of Improvement
Equity offerings, including initial public offerings (IPO), secondary offerings, and private investment in public equities (PIPEs), recorded a decline in the number of deals and an increase in deal values with 575 deals worth $28.6 billion in 2012, as compared to 582 deals worth $20.6 billion in 2011.
In deal value, IPO market showed signs of improvement in 2012 by recording deals worth $8.8 billion in2012, as compared to $5.5 billion in 2011. However, the number of IPOs declined marginally to 42 in 2012 from 45 in 2011. Besides, 226 secondary offerings worth $14.1 billion were reported in 2012.
PIPE deals reported an increase in deal values in 2012. The deal values increased to $5.7 billion in 2012 from $5.1 billion in 2011. However, the number of deals decreased to 307 in 2012 from 348 in 2011.
Debt offerings, including public debt offerings and private debt placements, reported an increase in deal values with $93.9 billion in 2012, as compared to $85 billion in 2012. However, the number of deals decreased from 219 in 2011 to 180 in 2012.
Licensing Agreements And Their Values Decreased In 2012
Licensing agreements recorded a decrease in deal values in 2012 with $18.2 billion in 2012, as compared to $20.1 billion in 2011. The number of deals also decreased to 486 deals in 2012 from 583 deals in 2011. Licensing agreements recorded a decrease in upfront payments and milestone payments in 2012. The segment reported $2.2 billion in upfront payments and $13.6 billion in milestone payments in 2012, as compared to $2.5 billion and $16.3 billion respectively in 2011.
The highest number of licensing deals was reported in oncology therapeutics market in 2012 with 97 licensing deals worth $5 billion in 2012. In licensing by phase, products in Marketed phase recorded 65 deals, accounting for 26% of the total deals in 2011. In second place, products in Phase II accounted for
19% of the deals. In deal values, Pre-Clinical products accounted for 31% of the deal value.
Partnerships, including joint ventures, co-marketing and co-development agreements, reported a decrease in number with 804 deals in 2012, as compared to 965 deals in 2011. The deal values also decreased to $10.7 billion in 2012 from $17 billion in 2011.
Venture Capital Market Reported An Increase In Deal Activity In 2012
The venture capital (VC) market recorded an increase in the number of VC deals and their values in 2012. The market reported 1,021 deals worth $7.1 billion in 2012, as compared to 790 deals worth $7 billion in2011. Venture capitalists continue to invest in pharma industry despite regulatory and exit issues, as the returns are higher when compared to other industries. Deals in start-up stage constituted 60% of the total deals in 2012. In second place, growth/expansion stage financing recorded 289 deals, accounting for 28% of the total deals.
New Enterprise Associates topped the list of venture financing firms with participation in 19 transactions worth $618.6m in 2012. Intarcia Therapeutics, Inc.; Nova Medical Centers India Private Limited; Alimera Sciences, Inc.; Mirna Therapeutics, Inc. and Dermira Inc., are some of the companies, which were successful in raising financing from New Enterprise Associates in 2012.
In 2012, private equity (PE) market recorded 135 deals, as compared to 120 deals in 2011. However, deal values decreased to $9.1 billion in 2012 from $11.7 billion in 2011. Out of 135 private equity dealsreported in 2012, 55 were direct investments, followed by 42 institutional buy-outs (IBO), 22 secondary buy-outs, 12 management buy-outs (MBO), three private transactions and one buy-in management buy- out (BIMBO) deal.
Deals In North America Increased In 2012
North America recorded an increase in the number of deals and deal values in 2012. It reported 3,019 deals worth $223.5 billion in 2012, as compared to 2,882 deals worth $216.5 billion in 2011. With economy showing signs of recovery, companies felt easy to participate in deal activity in 2012.
With structural problems continuing in Europe, companies in the in region have limited their exposure to deal activity in 2012. The region recorded a decrease in the number of deals, with 1,047 deals in 2012, as compared to 1,235 deals in 2011. Deal values also decreased from $83.6 billion in 2011 to $75 billion in2012.
The Asia Pacific region recorded a decrease in the number of deals and deal values with 831 deals worth $41.4 billion in 2012, as compared to 1,025 deals worth $48.9 billion in 2011.
