--- title: Biopharma M&A Outlook for 2018 • Generis description: Biopharma M&A activity will likely pick up in 2018, spurred on by tax reform and the repatriation of foreign funds. M&A activity will be in increasingly-crowded categories, such as cancer therapeutics, and focus on young or early-stage development companies with novel or niche thereapies. --- [Blog • Generis Group](https://blog.generisgp.com/blog) # [Biopharma M&A Outlook for 2018 • Generis](https://blog.generisgp.com/blog/2018/02/16/biopharma-ma-outlook-2018) Written by [Generis](https://blog.generisgp.com/blog/author/generis) | February 16, 2018 8:18:07 AM Z Biopharma M&A activity has already been big news in 2018. On January 22**,** [it was reported](https://www.wsj.com/articles/celgene-to-buy-juno-therapeutics-for-9-billion-1516624153) that **Celgene** had bought the 90% of **Juno Therapeutics** it did not already own for $9 billion, just weeks after they [announced the purchase](http://ir.celgene.com/releasedetail.cfm?releaseid=1053509) of cancer startup **Impact Biomedicines**.  This news fits within a few broader trends we are seeing in the biopharma industry and sets the tone for this year, in which we expect to see a lot more M&A activity in the industry. Tax reform in the United States, particularly a lower levy on US companies’ overseas cash, means we will see companies repatriating these funds and likely spending them on M&A activity. This M&A activity will lead to consolidation in increasingly-crowded categories, such as cancer therapy, and there will be a continued focus on young or early-stage development companies. ***Potential for more M&A Activity as a result of tax reform*** Pharma companies were holding back on acquisitions in 2017, waiting on tax reform to be passed in Congress. Policy uncertainty, [EY reports](https://www.genengnews.com/gen-news-highlights/from-jp-morgan-more-capital-will-boost-biopharma-ma-in-2018/81255350), accounted for a decline in the percentage of M&A deals carried out by U.S. biopharma companies in recent years—from 52% in 2015, to 39% in 2016, to 30% last year. That percentage should bounce back due to the recent tax reform, says EY, and we can expect a lot more M&A activity in Biopharma. Tax reform is allowing US drugmakers to repatriate foreign cash at a lower rate, which will give them significant buying power. According to a Credit Suisse analyst [report,](https://www.fiercepharma.com/pharma/tax-reform-advancing-pharma-s-dealmakers-likely-pick-up-pace-2018) big pharma and biotech companies have nearly $150 billion in cash that is expected to be repatriated and could be deployed towards mergers and acquisitions. ***More M&A activity in increasingly crowded categories*** One notable pharma deal that did occur in 2017 was the acquisition of **Kite** by **Gilead Sciences** for $10.2 billion to get access to its approved CAR-T medication, Yescarta. In 2018, we can expect to see more consolidation in increasingly-crowded categories, such as cancer therapy, and indeed have seen this with Celgene’s two recent acquisitions, Juno Therapeutics and Impact Biomedicine. Celgene’s recent purchase of Juno Therapeutics will build its development pipeline and give them ownership of an experimental gene therapy drug to treat cancer that Juno is working on, which is a CAR-T cell immunotherapy. CAR-T’s harness the body’s own immune cells to recognize and attack malignant cells. They are a hot topic in the biomanufacturing industry, as they are expected to be blockbusters for pharmaceutical companies as well as improve on current forms of cancer treatment. Novartis received the first FDA approval for a CAR-T drug last year. Juno does not yet have any FDA approvals for its CAR-T drugs, but in November 2017 they released promising data from early trials for their blood cancer treatment, known as JCAR017. ***Continued focus on young or early-stage development companies with potential for blockbusters with novel and niche therapies*** With a new FDA commissioner, there has been an uptick in FDA approvals over the last year. This could also drive biopharma M&A activity, says the [EY report](https://www.genengnews.com/gen-news-highlights/from-jp-morgan-more-capital-will-boost-biopharma-ma-in-2018/81255350), by heightening competition among companies, especially in increasingly crowded categories. “In certain therapeutic areas, a segment might get overcrowded. It is possible that parts of oncology are heading in that direction. That could lead to more consolidation and more M&A,” Jeff Greene, EY global life sciences transaction advisory services leader, told [GEN.](https://www.genengnews.com/gen-news-highlights/from-jp-morgan-more-capital-will-boost-biopharma-ma-in-2018/81255350) We can see this starting in Celgene’s acquisition of three-month-old Impact Biomedicines, which was to give them fedratinib, a kinase inhibitor that has shown promise as a potential treatment for a type of blood cancer called myelofibrosis. Juno Therapeutics and Kite also were fairly young companies with novel drugs in the CAR-T space. 2018 will be an exciting time as we expect to see more focus on these young or early-stage development companies with novel or niche therapies. *Want further insight and understanding of trends in the biopharma landscape? Join us at the American Biomanufacturing Summit. Speakers at this year’s event include Celgene, Kite Pharma, Juno Therapeutics, and more!  *[**VIEW THE PROGRAM**](https://biomanamerica.com/) [View full post](https://blog.generisgp.com/blog/2018/02/16/biopharma-ma-outlook-2018) ```json { "@context" : "http://schema.org", "@type" : "BlogPosting", "author" : { "@type" : "Person", "name" : "Generis" }, "dateModified" : "2023-08-03T19:43:06.231Z", "datePublished" : "2018-02-16T08:18:07Z", "headline" : "Biopharma M&A Outlook for 2018", "image" : { "@type" : "ImageObject", "height" : 90, "url" : "https://21354202.fs1.hubspotusercontent-na1.net/hubfs/21354202/Imported_Blog_Media/BIO-2.png", "width" : 728 }, "mainEntityOfPage" : "https://blog.generisgp.com/blog/2018/02/16/biopharma-ma-outlook-2018", "publisher" : { "@type" : "Organization", "logo" : { "@type" : "ImageObject", "height" : 60.0, "url" : "https://21354202.fs1.hubspotusercontent-na1.net/hubfs/21354202/Generis%20Logo%20full%20Colour%20(Large)-4.png", "width" : 414.10712 }, "name" : "Blog • Generis Group" } } ```