In case you were wondering, why Pharma companies are “too big to nail”, here’s the chart to start with. This infographic shows how, over the last 2 decades, 60 Pharma companies have become just 10 Big Pharma companies. This consolidation has helped Big Pharma gain more muscle to influence regulation while simultaneously diminish the competition.
Pfizer Merger And Acquisition (M&A) Analysis 1995 To 2015
Pfizer ranked no. 1 in terms of revenues (including Allergen) has grown big by megamergers and acquisitions. Pfizer acquired Warner–Lambert in 2000 for $111.8 billion, mainly to gain control of Lipitor. In 2002, Pfizer agreed to buy Pharmacia for stock valued at $60.0 billion, again to acquire full rights to a product, this time Celebrex (celecoxib). Pharmacia, itself was formed by the series of mergers including that of Upjohn, Searle, and Monsanto. On January 26, 2009, Pfizer agreed to buy Wyeth for $68.0 billion. In February 2015, Pfizer acquired Hospira for $15.2 billion. Same year on November 23, 2015, Pfizer and Allergan, Plc announced the merger for an approximate sum of $160.0 billion.
Novartis Merger And Acquisition (M&A) Analysis 1995 To 2015
Novartis was created in 1996 from the merger of Ciba-Geigy and Sandoz Laboratories. Ciba-Geigy was formed in 1970 by the merger of J. R. Geigy Ltd and CIBA. In 2005, Novartis grew it’s generic division Sandoz significantly though the $8.29 billion acquisition of Hexal and Eon Labs. In the year 2006, Novartis agreed to acquire full control of Chiron Corp. for $5.1 billion. In 2010, Novartis paid $39.3 billion to fully acquire Alcon, the world’s largest eye-care company. In the year 2012 Novartis bought Fougera Pharmaceuticals for $1.5 billion in cash.
Sanofi Merger And Acquisition (M&A) Analysis 1995 To 2015
Sanofi is the result of series of mergers between Sanofi-Synthélabo and Aventis. Sanofi-Synthélabo was formed in 1999 when Sanofi merged with Synthélabo. Aventis was formed in 1999 by Rhône-Poulenc S.A. merger with Hoechst Marion Roussel (HMR). HMR itself was formed from the 1995 merger of Hoechst AG with Cassella, Roussel Uclaf, and Marion Merrell Dow. Sanofi-Aventis was formed in 2004 when Sanofi-Synthélabo acquired Aventis for $65.0 billion. In the year 2010, Sanofi-Aventis acquired Chattern Inc. for around $1.9 billion. After acquiring Genzyme for around $20.1 billion in the year 2011, Sanofi-Aventis changed its name to Sanofi.
Roche Merger And Acquisition Analysis (M&A) 1995 To 2015
Roche started its M&A activities to gain a foothold in USA Pharma market after announcing its first acquisition of Syntex Corporation in the year 1994 for $5.3 billion. Roche merged its Japan subsidiary Nippon Roche with Chugai in 2002 in a deal worth around $1.4 billion to get a majority stake in a Japanese company. On 22 January 2008, Roche acquired Ventana Medical Systems for $3.4 billion. In one of the mega deal of the year 2009, Roche acquired Genentech for $46.8 billionin March 2009.
Merck & Co. Merger And Acquisition (M&A) Analysis 1995 To 2015
Merck & Co. originally was established by Merck family in 1668. In November 1993, Merck purchased Medco Containment Services Inc. for $6 billion. In the year 2009, Merck merged with Schering-Plough in a $41.0 billion deal. Schering-Plough had acquired Organon from Akzo Nobel for $14.4 billion in 2007. Organon was the result of a merger between Diosynth and Organon in the year 2004. In June 2014 Merck acquired Cubist Pharmaceuticals for $8.4 billion, that was the result of a merger between Idenix Pharmaceuticals and Trius Therapeutics.
J&J Merger And Acquisition (M&A) Analysis 1995 To 2015
J&J operates its business through three broad divisions; Consumer Healthcare, Medical Devices, and Pharmaceuticals. The pharmaceutical division consists of Janssen & Cilag. In its largest acquisition, Janssen acquired consumer healthcare business of Pfizer for $16.6. billion in the year 2006.Other major M&A deals include $ 1 billion acquisition of Aragon Pharma in 2013 and Alios BioPharma, Inc. acquisition for $1.75 billion in 2014.
AstraZeneca Merger And Acquisition (M&A) Analysis 1995 To 2015
In the year 1999 Astra and Zeneca Group merged to form AstraZeneca (AZ). After series of small acquisitions, AZ announced its first billion dollar acquisition of Cambridge Antibody Technology in the year 2004. It acquired MedImmune for about $15.2 billion in the year 2007. In the year 2012, AstraZeneca acquired Ardea Biosciences for $1.3 billion. It acquired Amylin from BMS for $4.3 billion in 2013 and acquired ZS Pharma for $2.7 billion in 2015. AstraZeneca continued its buying in 2015 by taking 55% majority stake in Acerta for $4 billion.
GSK Merger And Acquisition (M&A) Analysis 1995 To 2015
GSK is the result of series of mergers between Glaxo-Wellcome and SmithKline Beecham. Glaxo and Burroughs Wellcome merged in 1995 to establish Glaxo Wellcome. SmithKline Beecham is the result of mergers between SmithKline & French merger with Beckman Inc. in 1982 and with Beecham in 1989. Glaxo Wellcome and SmithKline Beecham merged in January 2000 to form GSK (GlaxoSmithKline). GSK acquired Block Medication in 2001 for US$1.2 billion. In 2009 GSK acquired Stiefel Laboratories for US$3.6bn. In the year 2013 GSK acquired Human Genome Sciences (HGS) for $3 billion. Novartis and Glaxo agreements worth $20 billion are excluded from this analysis.
Teva Merger And Acquisition (M&A) Analysis 1995 To 2015
M&A have contributed immensely to the present success of Teva. Current day Teva is the result of a merger between Assia, Zori, and Teva in the year 1976. Teva completed its first mega-acquisition in 2006 of IVAX Corporation for the US $7.4 billion. Teva acquired Barr Pharmaceuticals for US$7.5 billion. It acquired Ratiopharm for US$5 billion in the year 2010. Teva acquired Cephalon for US$6.8 billion in the following year. After acquiring Auspex Pharma for $3.5 billion in 2015, Teva announced its biggest deal of $40.5 billion to acquire the generic business of Allergan.
Gilead Merger And Acquisition (M&A) Analysis 1995 To 2015
Gilled Sciences, since 1999 has done around 15 acquisitions. Its billion dollar acquisitions include CV Therapeutics acquisition for $1.4 billion in the year 2009 and $10.4 billion acquisition of Pharmasset in the year 2011.
Conclusion
As discussed in my earlier post Pharma led healthcare frauds are rising. In FY 2014 alone, the Department of Justice (DOJ) opened 924 new criminal health care fraud investigations that included big pharma companies like J&J & Teva. Are we seeing Big Pharma becoming equivalent to Big Banks that are too Big to fail? Allowing Big Pharma to continue business as usual despite them indulging in off-label Promotion, providing kickbacks, submitting false safety data and Medicare frauds does suggest that “Big Pharma is too big to nail”.
