NVO - 3 Potential Biopharma Buyout Targets

2024-04-23 13:12:48 ET

Summary

• The recent lack of M&A activity and rising interest rates have helped trigger an approximate 20% decline in small-cap biotech equities.
• Drug blockbusters facing key patent expirations and Big Pharma's surplus of cash suggest increased M&A volume in the coming year.
• Highlighting three promising small biopharma names that are attractive as standalone entities but also would make logical buyout targets.

Nothing kindles the "animal spirits" in the biotech and biopharma sector more than an uptick in M&A activity. The lack of deal volume lately has been one reason, along with rising interest rates, behind the recent swoon in small biotech names. The SPDR® S&P Biotech ETF ( XBI ) is down nearly 20% from its recent highs in late February. This has coincided with a rise in the yield on the United States 10-Year Bond Yield (US10Y) from just below 3.9% to just over 4.6% over that time....

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