2024 An Eventful Year, page-4

Focus on M&A activityPower says 2023 ended with a flurry of M&A activity and that is set to continue into 2024 across the market including healthcare.
He says there was the bid for health imaging company Volpara Health Technologies (ASX:VHT) from South Korean company Lunit, Inc for $1.15/share valuing the company at ~$300 million.VHT entered into a scheme implementation agreement with the deep learning-based medical AI company in December, but a final shareholder approval will still need to be sought at a scheme meeting of shareholders expected to be held in early Q2 2024.
There was also a bid for Probiotec (ASXBP), a manufacturer, packer and distributor of a range of prescription and over-the-counter (OTC) pharmaceuticals, complementary medicines and consumer health products.PBP has entered into a binding scheme implementation deed with listed Indonesian pharmaceutical manufacturer PT Pyridam Farma following a $3/share offer which it says implies an equity value of ~$251 million and enterprise value of ~$326 million.
“Then if we look overseas there has been quite a lot of M&A activity,” Power says.He says big Pharma Bristol Myers Squibb will buy Karuna Therapeutics for US$14 billion and gain a promising new schizophrenia drug to enhance its growth throughout the rest of 2020s with patents on its older therapies to start expiring later this decade.
Also in December, Bristol Myers Squibb announced plans to acquire radiopharmaceutical therapeutics company RayzeBio,for US$4.1 billion.
Another big pharma Eli Lily agreed to purchase Point Biopharma Global for US$1.4 billion in October last year, marking its official entrance into the radiopharmaceutical therapeutic space.
“That is quite a hot area and relevant to the likes of Telix Pharmaceuticals (ASX:TLX) and Clarity Pharmaceuticals (ASX:CU6) over here in Australia,”
Power says.“The question we’re asking ourselves is will the M&A activity likely continue?“Our view is it will, as particularly overseas you have the larger pharmaceutical companies trying to strengthen their portfolio.”He says Big Pharma may have patents due to expire so it will want to fill that gap or could be sitting on a lot of cash having not purchased any other companies or rights to new drugs for a while.
“The market has been by and large quite depressed for a couple of years so there’s some pretty good value out there,” he says.