Deal-Making Accelerates As Innovation Challenges Proliferate - Report

Article preview from "The Gray Sheet" - October 20, 2010

Merger and acquisition activity is experiencing a rebound in 2010 following a steep plunge in 2009, but burgeoning challenges to innovation will require changes for medical technology firms to succeed, according to an Ernst & Young ¹ report.

Deal-Making Accelerates As Innovation Challenges Proliferate - Report

Article preview from "The Gray Sheet" - October 20, 2010

Entitled "Pulse of the Industry: Medical Technology Report 2010," the report was released Oct. 19 at AdvaMed 2010: The MedTech Conference in Washington, D.C. The report defines medtech as medical devices, diagnostics, drug delivery systems and analytical/life science tools.

The total value of medtech merger and acquisition activity in the U.S. and Europe is recovering in 2010 following a 62% drop to $15.7 billion in 2009 when 172 deals were completed - "the worst year for medtech transactions since 2002," the report states. M&A activity reached highs in 2006 and 2007 before dropping off in the wake of the global financial crisis.

Deal activity for the first six months of 2010 totaled 89 transactions with an aggregate value of $16.9 billion, according to Ernst & Young. The mid-year total excludes Novartis' purchase of a majority interest in Alcon for $28.3 billion, completed in August, which would have brought the six-month total to $45.2 billion.

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