Big pharma acquisitions

If you accept the argument that big pharma needs more R&D productivity (and I'm not aware of an industry watcher that doesn't agree), and we agree that all the big companies are doing all they can to pursue in-licensing and acquisition from smaller companies, then we must accept that further big-scale acquisitions must be around the corner. We hear today that AZ are on the hunt; rumors have always abounded regarding AZ and GSK (although I don't see it happening just yet), SP must be worried now that generic flonase disrupts their respiratory strategy, and I've already talked about Merck - but who is buying?

Pfizer are looking to sell their OTC operations and have to be thinking about further acquisition to keep their needle moving. sanofi-aventis should now be sufficiently stable to be thinking about making a move and BMS does look like an interesting option for them. I think everybody knows that J&J are always looking - but rarely for a big company. So in my mind the real dark horses are the other European stalwarts - Roche and Novartis. Both have very strong portfolios and pipelines - especially so long as "bird flu" keeps adding millions to the Roche sales, and Roche must be thrilled withe their share of Genentech. Merger of the two seems highly unlikely in the near term, but both could benefit greatly from a major US-based acquisition. We have to watch this space, but I wouldn't be surprised to see a major move by either (or both) the Swiss majors before this year is out - unless of course they see pricing and margin pressures in the US market making acquisitions elsewhere more attractive (of which, more later).