Poor global revenue outlook will drive biopharmaceutical M&A in 2017; report

The biopharmaceutical industry's desire for inorganic growth is expected to intensify an already heated mergers and acquisitions (M&A) environment in 2017.

This is according to the EY M&A Outlook and Firepower Report 2017 that was launched today. With new regulatory and tax environments expected following the changing geopolitical landscape, most notably in the post-election USA, expectations are that the industry may roar past the $200 billion in global M&A deal volume seen in the last three years.

The EY report finds the industry's need to engage in M&A has become amplified as payers continue to push back forcefully on price increases for older drugs while dampening the growth trajectory of newer drugs, creating a potentially daunting payer-driven revenue growth gap. As the probability of revenue shortfalls increases across the global industry, even companies with solid growth prospects may look to pursue M&A in 2017 as a defensive safeguard.