The Deal LLC's Healthcare Dealmaking Symposium kicked off Tuesday morning with a panel discussion of the sector's M&A landscape in 2009.
Keith Pagnani, a partner at law firm Sullivan & Cromwell LLP, commented that although large deals were still happening in the sector there were some major changes from days past.
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"The deals we're seeing now are more defensive than opportunistic," Pagnani said. "They're taking on a different tone."
"The big pharma deals we saw back seven or eight years ago seemed more about the capitalizing on the opportunities of the combining companies," he continued. "The more recent deals seem to be more defensive in nature in that they are an attempt at diversification into other business lines like biotech, consumer, animal health; and away from the core pharma business likely due to the pressures confronting the industry like generic competition, thin R&D pipelines, a more risk averse FDA and potential government reimbursement reductions.
In terms of other deals we're also likely to continue to see, look at the biotech sector; we're going to see the strong preying on the weak, as biotechs see debt coming due."
"In a contracting economy, it's going to be hard for companies to get growth organically," he continued, "so you may see that fueling M&A as well." - George White
