Samil PwC "This Year’s Bio·Healthcare M&A, Active in Small and Medium-Sized Deals"

Impact of Big Pharma Patent Expirations
and Second Trump Administration

This year, mergers and acquisitions (M&A) in the bio and healthcare industry are expected to become more active due to patent expirations of global major pharmaceutical companies (Big Pharma) and policies of the second Trump administration. In particular, it is analyzed that small- and medium-sized transactions will have a significant impact on the market.

Samil PwC announced on the 7th that it published a global bio and healthcare M&A outlook report for this year containing such content. The report stated, "Not only large-scale M&A but also small- and medium-sized transactions are emphasized, and small- and medium-sized deals may have a greater impact on innovation and growth in bio and healthcare." It added, "Patent expirations held by global Big Pharma provide incentives to actively pursue M&A, and small bio companies with solid research results and market potential are likely to receive considerable attention."

Regarding the policies of the second Trump administration, the report said, "There have been positive discussions on deregulation, encouragement of technology development, and promotion of M&A," and "special attention should be paid to the Biosecurity Act." The Biosecurity Act is legislation aimed at protecting the U.S. bio industry and preventing the misuse of bio technologies that could threaten national security. However, in practice, it is widely viewed as a measure to restrict Chinese bio companies' operations within the U.S. The report emphasized, "In preparation for possible restrictions on Chinese Contract Development and Manufacturing Organizations (CDMOs) operating in the U.S. market, Korean companies should maximize opportunities such as supply chains to substitute for them, and timely government support and diplomatic strategies should be implemented in parallel."

Artificial intelligence (AI) and digital innovation are also expected to have a significant impact on the market this year. AI and digital-based technologies accelerate drug design and development and serve as tools to address workforce issues, inflation, and disparities in medical services. The report stated, "Medtech, digital healthcare, telemedicine, and healthcare analytics companies based on AI, digital, and IT have emerged as attractive investment targets."

Nam Seung-su, partner of Samil PwC’s bio and healthcare specialist team, said, "The global initial public offering (IR) and Korea Night Reception hosted by the Korea Bio Association during the JPM Conference were successfully held, demonstrating the rapidly growing status of Korean bio and healthcare in the global market." He added, "From an M&A perspective, Korean bio and healthcare companies with potential are likely to receive considerable attention this year." Lee Do-shin, head of Samil PwC’s Unicorn Support Center, advised, "As opportunities arise in bio and healthcare industry M&A, Korean companies need strategic preparation. From a policy perspective, it is time to provide support including financial assistance and diplomatic strategies to activate business partnering, investment attraction activities, and strategic M&A for Korean companies."

The report was prepared based on the JP Morgan Healthcare Conference (hereinafter JPM Conference) held over four days from the 13th of last month in San Francisco, USA. The JPM Conference, held every January, is considered the world's largest bio and healthcare investment event.

Meanwhile, Samil PwC operates a Bio M&A Support Center jointly with the Korea Bio Association along with its bio and healthcare professional service team.