This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here
Stocks Under $10 with 50-100% upside potential - 14 days FREE!

Everything You Need to Know About Biotech M&A in a Single Chart


You're looking at a chart of mergers-and-acquisition activity for the biotech sector going back to 2000. The chart was put together and published by BioCentury recently. ISI Group analyst Mark Schoenebaum shared the M&A chart with clients today, and I'm sharing it with you.

I don't have anything profound to say about the M&A activity trends, other than noting the number of public acquisitions and deal value increased in 2013 over 2012. Both years fell significantly below 2011 M&A deal flow.

There was some concern raised last year about significantly higher biotech valuations having a negative effect on M&A activity. Simply put: Acquirers might find takeout prices of their favored targets too high to justify. [Remember the rumors last year of Roche  (ROG) wanting to buy Alexion Pharma  (ALXN) but being turned off by the required price.]

Well, the M&A numbers from 2013 don't seem to suggest a significant slowdown in deal flow, so perhaps that bodes well for continued higher trend in 2014.

Here's what the analysts at J.P. Morgan had to say about biotech M&A in 2014:

Regarding M&A, we anticipate that the uptick in higher-profile activity (Onyx, ViroPharma, Algeta) in 2H13 could extend into 2014 as pharma companies continue to seek out bolt-on deals (facilitated by plush pharma balance sheets and more mature biotech pipelines). This type of tailwind may be necessary for biotech to once again significantly outperform the broader markets.

My personal takeout predictions for 2014 are Regeneron Pharma (REGN), Cempra (CEMP), NPS Pharma (NPSP), Clovis Oncology (CLVS) and Halozyme (HALO). Throw in Biomarin Pharma (BMRN), too. Will deals for these companies actually happen? I have no clue.

-- Reported by Adam Feuerstein in Boston.  

Follow Adam Feuerstein on Twitter.

Adam Feuerstein writes regularly for TheStreet. In keeping with company editorial policy, he doesn't own or short individual stocks, although he owns stock in TheStreet. He also doesn't invest in hedge funds or other private investment partnerships. Feuerstein appreciates your feedback; click here to send him an email.

Select the service that is right for you!

COMPARE ALL SERVICES
Action Alerts PLUS
Try it NOW

Jim Cramer and Stephanie Link actively manage a real portfolio and reveal their money management tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
  • Weekly roundups
TheStreet Quant Ratings
Try it NOW
Only $49.95/yr

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
  • Upgrade/downgrade alerts
Stocks Under $10
Try it NOW

David Peltier, uncovers low dollar stocks with extraordinary upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
  • Weekly roundups
Dividend Stock Advisor
Try it NOW

Jim Cramer's protege, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Alerts when market news affect the portfolio
  • Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
Real Money Pro
Try it NOW

All of Real Money, plus 15 more of Wall Street's sharpest minds delivering actionable trading ideas, a comprehensive look at the market, and fundamental and technical analysis.

Product Features:
  • Real Money + Doug Kass Plus 15 more Wall Street Pros
  • Intraday commentary & news
  • Ultra-actionable trading ideas
Options Profits
Try it NOW

Our options trading pros provide daily market commentary and over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.

Product Features:
  • 100+ monthly options trading ideas
  • Actionable options commentary & news
  • Real-time trading community
  • Options TV
To begin commenting right away, you can log in below using your Disqus, Facebook, Twitter, OpenID or Yahoo login credentials. Alternatively, you can post a comment as a "guest" just by entering an email address. Your use of the commenting tool is subject to multiple terms of service/use and privacy policies - see here for more details.
Submit an article to us!
DOW 17,039.49 +60.36 0.36%
S&P 500 1,992.37 +5.86 0.30%
NASDAQ 4,532.1040 +5.6220 0.12%

Brokerage Partners

Rates from Bankrate.com

  • Mortgage
  • Credit Cards
  • Auto

Free Newsletters from TheStreet

My Subscriptions:

After the Bell

Before the Bell

Booyah! Newsletter

Midday Bell

TheStreet Top 10 Stories

Winners & Losers

Register for Newsletters
Top Rated Stocks Top Rated Funds Top Rated ETFs