
Amgen saves biopharma’s buyout year
December’s $28bn takeout of Horizon bumps 2022’s M&A numbers to respectable levels.

Beaten-down biopharma was given a well-needed boost in the closing weeks of 2022, when Amgen won the bidding for Horizon Therapeutics. The $28bn deal also rescued the sector’s M&A stats, taking the total capital committed to just over $90bn.
Remarkably, transactions struck by just two companies – Pfizer and Amgen – account for more than half of that figure. The former is spending its Covid cash while the latter is trying to replace fading blockbusters, a motivation expected to drive deal making at other large developers in the coming months.
Three small deals that emerged yesterday at the JP Morgan healthcare conference probably give a taste of what is to come – smallish bolt-on deals that come with risk-sharing structures. With biotech valuations still depressed, acquirers have the power to dictate terms.
“The M&A environment has turned on its head from a seller’s to a buyer’s market,” Subin Baral, global life sciences deals leader at EY, told Evaluate Vantage. “The onus is on the seller to make sure they are a compelling asset.”
Annual biopharma M&A activity | |||
---|---|---|---|
Year | Total deal value ($bn) | Deal count | Median deal value, excl-$30bn+ deals ($bn) |
2018 | 148.4 | 183 | 195 |
2019 | 239.2 | 176 | 438 |
2020 | 131.0 | 176 | 279 |
2021 | 90.8 | 165 | 363 |
2022 | 90.5 | 171 | 247 |
Source: Evaluate Pharma. |
This power play was on show in 2022, with companies as diverse as Epizyme, Radius and F-Star finally accepting the new reality and selling out at depressed valuations.
Biopharma’s top-line M&A stats reflect this trend. The table above shows that the number of transactions did not really dip last year, though the total sum committed hit a five-year low. The median deal value dropped to a four-year low.
This picture would look a lot sorrier had Amgen not decided to pay up for Horizon. A big question is whether the sector is in for another long wait for the next big deal; the last transaction of comparable size was Astrazeneca's late-2020 takeout of Alexion, for $39bn.
Valuations at the more established end of the sector have been mostly unaffected by the market rout – many large developers have benefitted from their so-called defensive qualities. This means that filling revenue gaps will be expensive, though the looming patent cliff at the end of this decade will eventually force hands.
2023's biggest biopharma buyouts | ||
---|---|---|
Acquirer | Target | Deal value |
Amgen | Horizon Therapeutics | $27.8bn |
Pfizer | Biohaven | $11.6bn |
Pfizer | Global Blood Therapeutics | $5.4bn |
Bristol Myers Squibb | Turning Point | $4.1bn |
Amgen | Chemocentryx | $3.7bn |
Note: Horizon deal not closed. Source: Evaluate Pharma |