Pharma M&A versus alliances and its underlying value drivers

Are M&A or alliances the right therapy for an ailing pharmaceutical industry?- A capital market perspective

by Heiko Schön (Author)
©2015 Thesis 201 Pages


From a capital market perspective, the author analyzes Merger and Acquisitions transactions (M&A) and in-licensings in the pharmaceutical industry between 1998 and 2012. Utilizing the event study methodology, the volume shows that M&A experiences significant, negative cumulative average abnormal returns whereas in-licensings are able to create value. But what are the underlying value drivers which make a deal a success or a failure story? The author derives significant innovative determinants of success for both strategies.

Table Of Contents

  • Cover
  • Title
  • Copyright
  • About the author(s)/editor(s)
  • About the book
  • This eBook can be cited
  • Content
  • Table Index
  • Graph Index
  • A. Introduction
  • I. The Pharmaceutical Industry and Its Paradigm Shift
  • I.1 History
  • I.2 Market Analysis
  • I.2.1 Market Definition
  • I.2.2 Market Size and Market Growth
  • I.2.3 Big Pharma
  • I.2.4 Geographic Segmentation
  • I.2.5 Therapeutic Segmentation
  • I.2.6 Blockbusters
  • I.3 Innovation and Innovation Crisis
  • I.3.1 R&D Productivity
  • I.3.2 R&D Process
  • I.3.3 R&D Pipeline
  • I.4 Patent Protection and Patent Cliff
  • I.5 Generics
  • I.6 Biotechnology
  • I.7 Pricing, Funding and Governmental Austerity Measures
  • I.8 Restructuring Programs
  • I.9 Summary
  • II. The Pharmaceutical Industry and Mergers & Acquisitions
  • II.1 M&A Deal Rationales
  • II.1.1 Scale & Synergy Deals
  • II.1.2 Innovation Deals
  • II.1.3 Pharmerging Market Deals
  • II.1.4 Diversification Deals
  • II.2 Status of Consolidation
  • II.3 M&A Activity Development
  • II.4 Top Pharmaceutical M&A Transactions
  • II.5 Summary
  • III. Value Creation in Pharmaceutical M&A and its underlying Value Drivers
  • III.1 Literature Review and Literature Contribution
  • III.2 Data Sample
  • III.3 Deal Statistics
  • III.4 Research Methodology
  • III.5 Acquirers’ Wealth Effects
  • III.6 Univariate Subsample Analyses of M&A Value Drivers
  • III.6.1 Target’s Business Nature
  • III.6.2 Geographical Focus
  • III.6.3 Pharmaceutical Merger Waves
  • III.6.4 Relative Transaction Size
  • III.6.5 Method of Payment
  • III.6.6 Target’s R&D Intensity
  • III.6.7 Strategic Alliances Pre-Merger
  • III.6.8 M&A Experience
  • III.6.9 Relative Price Level
  • III.6.10 Target’s Financials
  • III.7 Multivariate Analysis of M&A Value Drivers
  • III.8 Conclusions and Recommendations
  • IV. The Pharmaceutical Industry and Alliances
  • IV.1 Strategic Alliances
  • IV.2 Pharmaceutical In-Licensing
  • IV.3 In-Licensing Activity Development
  • IV.4 Top In-Licensing Deals
  • IV.5 Summary
  • V. Value Creation in Pharmaceutical In-licensings and its underlying Value Drivers
  • V.1 Literature Review and Literature Contribution
  • V.2 Data Sample
  • V.3 Deal Statistics
  • V.4 Licensee’s Wealth Effects
  • V.5 Univariate Subsample Analyses of In-licensing Value Drivers136
  • V.5.1 National and cross-border Partnerships
  • V.5.2 M&A Waves
  • V.5.3 Stage of Drug Candidate
  • V.5.4 Targeted Therapeutical Area
  • V.5.5 Financial deal components
  • V.5.6 US Co-commercialization Rights
  • V.5.7 Prior-licensing Alliances
  • V.5.8 Licensees’ experience
  • V.6 Multivariate Analysis of In-licensing Value Drivers
  • V.7 Conclusions and Recommendations
  • VI. M&A versus In-licensing
  • VII. Conclusions and Future Research
  • B. References
  • C. List of Abbreviations

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Table Index

| 11 →

Graph Index

| 15 →


ISBN (Hardcover)
Publication date
2015 (September)
Mergers and Acquisitions Success factors Value creation
Frankfurt am Main, Berlin, Bern, Bruxelles, New York, Oxford, Wien, 2015. 201 pp., 22 tables, 18 graphs

Biographical notes

Heiko Schön (Author)

Heiko Schön studied international business administration at Wiesbaden Business School. He was scholar of the German National Merit Foundation (sdw), he owns an Executive MBA from the University of Münster and earned his PhD at the University of Darmstadt. He brings in 10 years of experience in the pharmaceutical and chemical industry.


Title: Pharma M&A versus alliances and its underlying value drivers