Tuesday, April 21, 2009

Pharma Deals Exploding in 2009

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According to TheStreet.com, pharma deals in the first quarter of 2009 were worth nearly 50% more than all the industry deals announced in 2008, according to a new report.

The report, from The Mergermarket Group of New York and London, says deals in the quarter carried a combined value of $166 billion -- more than 10 times that of deals announced in last year's first quarter and well over the $114 billion in deals announced in all of 2008. Roche bought the 44% of Genentech (DNA Quote) it didn't already own for $47 billion. Pfizer (PFE Quote) is buying Wyeth for $64 billion and Merck (MRK Quote) is buying Schering-Plough (SGP Quote) for $43 billion.

The deals seem evidence that despite the downturn big pharma still boasts the big cash flow to make major moves. In the case of Merck, the reason for the Schering-Plough merger was clear: There is simply no projected earnings growth for Merck by analysts over the next few years thanks to patent expirations and a dearth of pipeline drugs, Brian Gilmartin said in a recent note to investors on

With this boom in mergers for 2009, what will Pharma do with the online sphere? At ePharma we discussed how drug companies may look more into social networking to educate consumers on care of their particular disease. But with Pharma companies growing larger and larger will their online presence get bigger or dwindle under the pressure of their expansive drug offerings?
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