Life Sciences & Pharmaceuticals

Q1 of 2023 saw 14 deals in the Life Sciences & Pharmaceuticals sector. Although this was a slight uptick on the prior quarter, in recent years there has been a notable downward trend in deal volume. Deals executed during Q1 2023 include:

• Sale of Opiant Pharmaceuticals to Indivior for £120m
• The acquisition of Clinisupplies by KKR for an undisclosed amount

The deals activity in this sector has been influenced by:

• R&D – large pharmaceutical companies continue to consolidate to ensure they have a viable pipeline of future products.
• NHS contracts - in the UK, the NHS is the dominant purchaser of new treatments. Being able to achieve pricing that provides a return for investors and good value for taxpayers can be challenging.

The research-focus of the sector means the sector is dominated by small equity-backed startups. The result is that by design the sector can experience a certain degree of business failure when cutting-edge treatments are ineffective or otherwise unable to progress through clinical trials.

Yet with that caveat, the sector has been seen to have very low levels of restructuring activity. The pandemic demonstrated to investors both the importance of the sector to the wider economy and possible returns from successful research cycles.