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Quick View: Biopharma Dealmaking in Q3

The first half of the year showed some promise. Did the third quarter continue the trend? Well…


If you read our round up of the state of the biopharma market at the halfway point of the year, you may have come away with, if not a spring in your step, then a least a little bounce. M&A, in particular, had picked up with over $80bn of deals already in the bag by the end of June, a figure that beat the full year number for 2022. IPOs were still as rare as hens’ teeth, and there was a clear line between the haves and have-nots, but glimmers of hope were there.

We recently published our analysis of the third quarter and, while it’s not quite fair to say that optimism was misplaced, we cannot consider the recent tough environment to be behind us. As always, we’ve taken a look at the data from Evaluate Pharma to consider the current state of M&A, IPO activity and venture financing.

There’s plenty of data and analysis to pick over in the new report, which I recommend you take a look at, but here’s a quick look at the highlights.


The good news is that one lingering hurdle on the M&A horizon was cleared. The FTC dropped their suit to block the Amgen/Horizon deal, leaving the companies to complete the largest deal from 2022. However, there is still uncertainty about how the FTC may intervene in future deals. 24 deals were announced in the third quarter, but most were small and Biogen’s purchase of Reata accounts for more than a quarter of the overall $28bn of spend. The half-year data suggested that we were on track for the busiest takeover year since 2019, but the final quarter has a lot of heavy lifting to do if that’s going to be the case. Still, 12 months ago, many in the industry would have settled for a middling performance so let’s keep things in perspective.


What’s that creaking sound? Ah, perhaps it’s a long-shut IPO window finally easing open. Just a handful of companies hit the public markets between July and September, but it was a step forward. Or at least it was for some of them. Many saw their initial valuations fall in the weeks following flotation and they’ll be hoping to recover that ground sooner rather than later. It’s also worth noting that all the flotations were in the US – Europe remains an IPO desert.

Venture Financing

Fundraising remains a challenge, with VC data showing quarter-on-quarter drops in the number of biopharma companies raising private cash. With a large proportion of biotechs set to run out of funds within two years, this is a concerning picture. But, until IPOs and M&A activity pick up, providing exits for backers, venture capital investors are having to fund their portfolio companies for longer periods of time, meaning cash isn’t being freed up as quickly as most would like.

Overall, it’s not as bad a picture as it may have been, but it’s not a miracle recovery either. Uncertainty remains a theme, with factors like the Inflation Reduction Act and an increasingly difficult geopolitical landscape making short and long-term planning a challenge. However, the patent cliff provides a strong catalyst for more dealmaking and there are still hopes for a strong-ish finish to the year.

Take a look at our report and infographic for much more detail and analysis – and keep your fingers crossed for the next couple of months!


Carolyn Hall

Director, Content & Thought Leadership Marketing


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