3. Biotech and Idenix Pharmaceuticals It was a roller coaster January for hepatitis C drugmakers after Bristol-Meyers Squibb ( BMY) bid $2.5 billion for Inhibitex ( INHX), launching a Hep C "deal-a-palooza" that pushed competitor shares higher. After the deal, investors focused on whether other independent drug makers with Hep C drugs in development could be targets to a larger industry player looking add drugs as others go generic. While Achillion Pharmaceuticals ( ACHN) emerged as another possible takeover candidate, analysts and investors focused on Idenix Pharmaceuticals ( IDIX). Idenix Pharmaceuticals may be the next hepatitis C acquisition in the biotech space after the Inhibitex deal, according to a research note published by Wedbush research analyst Duane Nash. There was plenty of pent up demand for Inhibitex, which received 5 competing bids to go with Bristol-Meyers Squibb's winning offer, according to a regulatory filing. At a January industry luncheon discussing hepatitis C drug development, a poll by ISI Group biotech analyst Mark Schoenebaum of 120 participants showed that Idenix Pharmaceuticals had a greater than 50% chance of being acquired. The size of the commercial opportunity for new all-oral Hep C treatment regimens is a much-debated topic, with many seeing big sales numbers. Forty eight percent of the investors at the January meeting predicted worldwide Hep C drug sales between $8 billion and $10 billion by 2019. Idenix Pharmaceuticals shares surged on Bristol Meyers Squibb's Inhibitex purchase, which was cut at a 163% premium to the company's share price prior to the deal announcement. However in February, Idenix shares dropped from post-crisis highs earlier after results from a competing hepatitis C treatment by Gilead Sciences ( GILD) raised questions about the need for Idenix's IDX-184 drug in development. Other potential deals in the healthcare sector include a potential takeover of clinical research providers Covance ( CVD) and Charles River Laboratories ( CRL), according to a February research note from Sterne Agee analyst Greg Bolan. Jefferies analysts also pointed to Wuxi PharmaTech ( WX) as a potential private equity target. In Roche's hostile offer for Illumina, investors bid the genetic sequencing machinery maker's shares far higher than the $73 offer price after large cap healthcare equipment makers like Siemens Healthcare ( SI), Johnson & Johnson ( JNJ), Abbott Laboratories ( ABT) and Becton, Dickinson ( BDX) emerged as competing bidders according to analysts. Nevertheless, even after deal announcements there are still risks for investors betting on M&A in the healthcare and pharmaceutical space. In January, Valeant Pharmaceuticals ( VRX) withdrew its hostile $7.5 a share offer for ISTA Pharmaceuticals ( ISTA) after making little progress on takeover negotiations. A mega-merger between Express Scripts ( ESRX) and Medco Health Solutions ( MHS) could still be iced on antitrust scrutiny.