Specialty subsectors such as oncology are attracting the greatest M&A interest from big pharma

In our latest ASCO-themed expert view piece, Michael Jewell, healthcare partner at Cavendish Corporate Finance, discusses why the oncology sector is seeing increased M&A activity and offers advice to buyers and sellers on how to maximize opportunities in the market and complete deals on the most favorable terms.

Since the start of 2017, the global pharmaceuticals sector has led the pharma and life sciences M&A market in deal volumes, closing 27 deals valued at over £33.9 billion1. Patent expirations, declining R&D returns and the requirement to purchase early-stage assets has created an environment that is prime for pharma M&A.

These trends also follow the rise of promising pharma subsectors, with the next generation of pharmaceutical blockbusters expected to be primarily specialty drugs that are aimed at the rarest and most difficult to treat diseases. Of these subsectors, oncology has seen the largest levels of M&A activity, with global spending on cancer drugs expected to reach $178 billion by 20202, up from $107 billion in 20153, making oncology medication one of the biggest anticipated drivers of prescription drug revenue over the next five years and an environment that is helping to drive overall pharma M&A.