E&Y predicts £34bn global biotech market
M&A activity to boost industry
Big Four firm Ernst & Young has predicted a year of mergers and
acquisitions in the global biotechnology sector in 2006 pushing it towards the
$60bn (£34bn) mark.
The report, published yesterday, said the M&A activity would continue a
trend that began last year, when large pharmaceutical companies significantly
increased acquisitions in the biotech sector.
‘We will probably see fewer IPOs and more big pharmaceutical M&As
(pharmas buying into the biotech sector),’ said William Powlett Smith, head of
Ernst & Young’s UK biotech team.
US drug companies have also repatriated more than $50bn in cash from overseas
earnings, and have significant cash to invest, E&Y said.
Last year, there were a record 23 initial public offerings of biotech
companies in Europe, compared with 13 in the US, taking the number of public
companies to 122.