Biotech merger and acquisition activity soars in 2012
Mergers and acquisitions in the Biotech sector enjoy strong performances.
Stocks in Biotechnology enjoyed a successful 12 months as mergers and acquisitions activity in the sector reaches a four-year high.
Legislation, such as the FAST and TREAT acts, have boosted investor confidence and helped Biotech stocks enjoy some of the strongest performances on the market, with iShares Nasdaq Biotechnology Index Fund up over 28 per cent in 2012.
This outperformed the Dow Jones industrial average, according to market research firm Five Star Equities, which has been examining the outlook of companies in the Biotech Industry.
According to Thomson Reuters, biotech merger and acquisition activity is at a four-year high - with the volume exceeding $25 billion, around $15 billion more than in 2011. This is because large pharmaceutical firms are dealing with major patent cliffs.
Global head of mergers and acquisitions at Credit Suisse Scott Lindsay stated that with patents expiring, firms have gaps in their revenue line that they are looking to fill.
"The other part is just shoring up the pipeline they have, so even if they don't have a major patent problem, they're all looking for growth," he concluded.
Posted by Edel Quinn
Source: Five Star Equities press release, August 22nd