It’s critical that competition policies reflect the unique and fundamental role of mergers and acquisitions (M&A) in America’s life sciences industry. Policies that support pro-competitive life sciences M&A can help drive growth, incentivize investment and, most importantly, advance new medical innovations to patients.
Sanofi CEO Paul Hudson recently underscored this reality in an article for the World Economic Forum, arguing that fostering a supportive environment for competitive life sciences M&A can help unleash “a pivotal year of progress” for biopharmaceutical innovation in 2025.
“Biopharma M&A has also been robust in 2024, and this momentum is expected to continue into 2025…The large volume of M&A has the potential to reinforce pipelines, strengthen innovation with sufficient funding and accelerate time to market.”
As Hudson affirms, life sciences companies of all sizes rely on M&A to be able to unlock specialized resources, funding and expertise and be able to successfully bring new treatments and cures to market.
Hudson also rightly points out the importance of a strong venture capital landscape in driving the scientific risk-taking and early-stage innovation that ultimately yields new medicines. As more than 80% of life sciences companies operate without a profit, M&A represents a clear path forward for promising therapies, and serves as a vital exit point for investors. In this way, life sciences M&A incentivizes and sustains investment in the next generation of treatments for patients.
Unfortunately, recent policies from the U.S. Federal Trade Commission and Department of Justice have risked broadly deterring M&A. The 2023 Merger Guidelines and newly finalized Hart-Scott-Rodino (HSR) premerger notification rule have jeopardized the many pro-competitive partnerships that life sciences companies of all sizes depend on to bring innovation from the lab to patients. Reversing this worrying trend is also critical to maintaining America’s status as a global leader in life sciences innovation. Policymakers must join leaders from across the life sciences industry in recognizing and supporting M&A as a core component of the American life sciences industry.