Acquisitions, Licensing Deals Take Centerstage in Pharma/Biotech Space
Mergers and Acquisitions (M&A) have picked up significant pace in 2025 in the pharma/biotech sector after a passive run in 2024.
The recent spree of acquisitions signifies a focus on portfolio expansion and constant pipeline innovation, given the changing landscape and spotlight on AI-driven drug discovery. Simultaneously, bigwigs in the space also enter into licensing deals and collaborations for a promising drug/candidate to strengthen and expand their portfolios in their respective core areas.
Quick Take on Recent Acquisitions & Deals
Pharma giant Sanofi SNY recently announced that it will acquire Blueprint Medicines for a total deal value of up to $9.5 billion to expand its portfolio in rare immunological disease and add an early-stage pipeline in immunology.
The impending acquisition will add Blueprint Medicines' only marketed product, Ayvakit (avapritinib), an inhibitor of KIT and PDGFRA proteins, to Sanofi's commercial portfolio.
Bristol Myers Squibb BMY recently announced a strategic collaboration agreement with BioNTech for the global co-development and co-commercialization of the latter's investigational bispecific antibody BNT327 across numerous solid tumor types.
BNT327, a next-generation bispecific antibody candidate, targets PD-L1 and VEGF-A. Per the terms, BMY will make an upfront payment of $1.5 billion to BioNTech. In addition, BioNTech will also receive $2 billion in non-contingent anniversary payments through 2028.
Developing bispecific antibodies that target two proteins, namely PD-1 and VEGF, has lately been one of the lucrative areas in cancer treatment, attracting other pharma giants as well. In May 2025, Pfizer inked a licensing agreement with 3SBio for the development, manufacturing and commercialization of SSGJ-707, a bispecific antibody targeting PD-1 and VEGF, outside China.
While oncology and immuno-oncology companies have always been at the top of acquisition targets, the lucrative obesity sector and gene-editing space are also being eyed.
Last week, Regeneron REGN entered into an in-licensing agreement for an obesity drug with Hansoh Pharmaceuticals Group Company Limited, in a bid to expand its clinical-stage obesity portfolio. The licensing agreement with Hansoh Pharma provides Regeneron with HS-20094, a GLP-1/GIP receptor agonist.
M&A in Focus in 2025
Consolidation has long been a central focus in the pharma/biotech industry. This is because leading companies constantly look to diversify their revenue base in the face of dwindling sales of their high-profile drugs. Acquisitions also make sense as developing a drug/technology from scratch is costly and risky.
In April, pharma giant Johnson & Johnson acquired Intra-Cellular Therapies for approximately $14.6 billion and added antidepressant drug, Caplyta, to its neuroscience portfolio.
Swiss pharma bigwig Novartis NVS, too, has been on an acquisition spree.
Novartis is all set to acquire San Diego-based clinical-stage biopharmaceutical company Regulus Therapeutics to strengthen its renal disease portfolio.
Regulus' lead asset, farabursen, is a potential first-in-class, next-generation oligonucleotide targeting miR-17 for the treatment of autosomal dominant polycystic kidney disease.
In April, Germany-based Merck KGaA announced that it will acquire SpringWorks Therapeutics, Inc. for $3.9 billion to expand business in the United States. SpringWorks Therapeutics, a U.S.-based biopharma company, has a portfolio that comprises a first-in-class, systemic standard-of-care therapy in adults with desmoid tumors and the first and only approved therapy for adults and children with neurofibromatosis type 1-associated plexiform neurofibromas.
Potential Deals
We expect M&A activity to accelerate further in 2025, given the massive cash reserve owned by major pharma and biotech companies.
These companies will also look to utilize innovative technology to develop breakthrough treatments rapidly as the landscape evolves. Moreover, smaller biotechs often lack the necessary funds to successfully develop a drug and commercialize thereafter. The recent spotlight on the usage of AI technology for drug discovery should lure investment in this industry.
Zacks Names #1 Semiconductor Stock
It's only 1/9,000th the size of NVIDIA which skyrocketed more than +800% since we recommended it. NVIDIA is still strong, but our new top chip stock has much more room to boom.
With strong earnings growth and an expanding customer base, it's positioned to feed the rampant demand for Artificial Intelligence, Machine Learning, and Internet of Things. Global semiconductor manufacturing is projected to explode from $452 billion in 2021 to $803 billion by 2028.
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