Pharmaceuticals

Shire makes needy suitors work for risky bet

19 Apr 2018

The London-listed pharma group has rejected a 42 bln pound offer from Osaka-based Takeda, and may now face a bid from Botox-maker Allergan. Shire’s business has its challenges, but its would-be acquirers have strategic issues and need a deal. The risk of overpaying is going up.

P&G drug deal needs vitamin shot to persuade Peltz

19 Apr 2018

The U.S. consumer giant is paying 3.4 bln euros for the consumer arm of Germany’s Merck. For it to make sense P&G will have to crank up sales of Seven Seas vitamins while cutting out costs. Board member Nelson Peltz’s criticism of past acquisitions further raises the stakes.

Shire cancer sale boosts weak takeover defences

16 Apr 2018

The $47 bln drugmaker facing a potential bid from Takeda sold its cancer treatments for $2.4 bln. Shire’s debt and doubts over its business weaken its resistance. The best bet may be to show that a Takeda offer undervalues its business. But more radical surgery could be tricky.

Bayer investors get unwelcome antitrust present

10 Apr 2018

The German company has struck a deal with U.S. regulators to clear its $60 billion acquisition of seed group Monsanto, the Wall Street Journal reported. After EU approval in March, a two-year saga is almost over. Bayer’s sagging stock price means shareholders can hold the cheers.

Novartis $8.7 bln splurge balances risk and growth

9 Apr 2018

The Swiss drugmaker paid a near 90 pct premium for AveXis, which is developing a treatment for spinal muscular atrophy, weeks after selling its consumer drugs joint venture. Experimental drugs offer faster growth than painkillers but more risk. It’s a pricey way to boost revenue.

Walmart may have hit on healthy kind of disruption

30 Mar 2018

Merging with insurer Humana could put clinics in the U.S. retailer’s stores, keeping patients out of hospitals and insurance costs down. Walmart isn’t given to big acquisitions and $37 bln Humana wouldn’t come cheap. But a broader partnership could bring many of the benefits.

Takeda takes a turn at Shire’s risky M&A strategy

28 Mar 2018

The $42 bln Japanese drugs group may bid for $45 bln takeover machine Shire. There’s not much overlap, and uncertainties hang over key businesses. But Shire is cheap, and its shareholders exasperated. That may appeal to Takeda boss Christophe Weber, but it's also a warning.

Drug companies take the anti-Amazon pill

27 Mar 2018

Novartis is selling its consumer health assets to GSK for $13 bln. It makes sense for the former to focus on traditional drugs given the threat from e-commerce. For the latter, the purchase is less risky than a Pfizer deal and may still allow investment in its core business.

Reckitt may yet benefit from Pfizer’s poor timing

22 Mar 2018

The Dettol maker’s shares jumped after it pulled a bid for the U.S. group’s consumer arm. The auction coincided with CEO Rakesh Kapoor’s struggle to digest a big deal, and rival GSK’s need to focus elsewhere. If Pfizer delays the sale, Reckitt could limber up for a second shot.

Profit is only part of U.S. healthcare sickness

12 Mar 2018

America spends about 18 pct of GDP on healthcare – almost twice as much as most developed countries. Pricing to reward investors accounts for perhaps a fifth of this gap. High pay, fights over the spoils and the fetishization of costly high-tech medicine are other factors.

Cigna pays over the odds for uncertain benefit

8 Mar 2018

The insurer is paying $54 bln for pharmacy middleman Express Scripts in the latest healthcare consolidation move. Express’s business has stalled and the FDA’s campaign for drug-price transparency threatens its model. Cigna’s $13 bln premium is not a sure prescription for growth.

Akorn deal could crack M&A MAC nut

6 Mar 2018

Merger escape clauses are notoriously hard to trigger. Even performance woes at drugmaker Akorn aren’t enough for Fresenius to demand a discount on an agreed $4.3 bln tie-up. If the German healthcare group can prove Akorn misled regulators, though, it is a different story.

Sanofi’s M&A bloodlust comes at a high price

29 Jan 2018

The French group is buying blood disorder biotech Ablynx for 3.9 bln euros. That’s 50 pct more than rival Novo Nordisk bid, including protections against drug flops. Combined with last week’s $11.6 bln purchase of a haemophilia group, Sanofi’s new acquisitiveness lacks caution.

Sanofi’s $11.6 bln bid ups investor blood pressure

22 Jan 2018

The French pharma giant is buying U.S. haemophilia group Bioverativ at a whopping 64 pct premium. Sanofi reckons the returns will clear its hurdle rate in three years, but hasn’t explained how. Roche’s rival drug means the deal could end up like Shire’s ill-fated Baxalta swoop.

Celgene readies $10 bln mix of need and hope

17 Jan 2018

The drug group may buy Juno Therapeutics, a biotech promising ways to modify immune cells to fight cancer. The two already have a partnership, but Celgene needs to grow. If it’s also sensing real potential, it could pay an eye-watering price for a firm with no approved products.

Celgene puts shareholders on $7 bln M&A trial

8 Jan 2018

Buying privately held cancer specialist Impact Biomedicines may help the biotech giant refill its pipeline after recent drug flops. Insisting on a series of earnouts based on sales reduces risk. But Celgene needs more than a booster shot to cure longer-term ailments.

Novo can pump its $3.1 bln blood bid even higher

8 Jan 2018

The Danish pharma group offered to buy Belgium’s Ablynx, which is developing a bleeding-disorder treatment. The returns look healthy for Novo Nordisk, which will also get a cheap option on two other potential drugs. That suggests rival bidders may not be far behind.

Deals a better bet for drug giants than R&D

2 Jan 2018

Last year, U.S. regulators approved the most new therapies since 1996. Yet the return on research outlays for big firms, barely topping 3 pct according to Deloitte, is inadequate and falling. More focused, smaller firms are winning scientifically – and their owners financially.

Our 2018 predictions on Reuters TV

31 Dec 2017

From the CEOs who should run for U.S. president, to the banks that ought to be sizing up mergers, our writers give their take on the coming year in a series of Reuters video reports.

Teva’s feverish bailing efforts deluged by reality

14 Dec 2017

The drugmaker is suspending its dividend and cutting 25 pct of its workers to try to stop a debt-laden 2015 deal sinking the company. But most of the savings will probably be eaten up by shrinking sales for its blockbuster drug and falling prices for other generic medicines.