Bio/Pharma M&A: Which Companies are Leading Deals in 2021?

By Patricia Van Arnum - DCAT Editorial Director

October 6, 2021

What have been the leading mergers and acquisitions among bio/pharmaceutical companies thus far in 2021? What is the strategy behind the deals, and which companies are seeking to target the greatest rewards?

Bio/pharma company M&A

Key deals among the bio/pharmaceutical majors include mergers and acquisitions by AstraZeneca, Sanofi, Merck & Co, Pfizer, Lilly, Bayer and others. Highlights of key deals are outlined below.

AstraZeneca’s $39-billion acquisition of Alexion Pharmaceuticals. Announced in December 2020 and closing in July 2021, the largest deal thus far in 2021 is AstraZeneca’s $39-billion acquisition of Alexion Pharmaceuticals, a Boston-based bio/pharmaceutical company focused on rare diseases. The acquisition marked AstraZeneca’s entry into rare diseases following closing of the deal, AstraZeneca formed a dedicated rare-disease group, Alexion, AstraZeneca Rare Disease, which is headquartered in Boston.

The acquisition gives AstraZeneca a further scientific presence in immunology and Alexion’s complement-biology platform and pipeline focused on rare diseases. Alexion is focused on complement inhibition for immune-mediated rare diseases that are caused by uncontrolled activation of the complement system, part of the immune system. The complement system plays an important role in many inflammatory and autoimmune diseases across multiple therapy areas, including hematology, nephrology, neurology, metabolic disorders, cardiology, ophthalmology, and acute care.

Alexion posted 2020 net product sales of $6.07 billion. Its top-selling product is Soliris (eculizumab), which is approved to treat two rare blood disorders: (1) paroxysmal nocturnal hemoglobinuria (PNH), a disease that is characterized by destruction of red blood cells, blood clots, and impaired bone marrow function and (2) atypical hemolytic uremic syndrome (aHUS), a disease that causes abnormal blood clots to form in small blood vessels in the kidney. The drug posted 2020 revenues of $4.06 billion and accounted for 69% of the company’s 2020 net product sales. Soliris faces near-term biosimilar competition, and its successor product, Ultomiris (ravulizumab), which was approved by the US Food and Drug Administration in 2018 to treat PNH and in 2020 for aHUS, posted 2020 net sales of $1.08 billion and was Alexion’s second largest selling product in 2020.

AstraZeneca’s Alexion further added to its rare-disease portfolio last month (September 2021) by exercising its option to acquire all remaining equity in Caelum Biosciences, a Bordentown, New Jersey-based bio/pharmaceutical company focused on rare diseases for an option-exercise price of approximately $150 million plus up to $350 million in regulatory and commercial milestones. Caelum’s lead asset is CAEL-101 for treating light-chain amyloidosis, a rare disease in which misfolded amyloid proteins build up in organs throughout the body, including the heart and kidneys.

Merck & Co’s pending $11.5-billlion acquisition of Acceleron Pharma, spin-off of Organon, and other acquisitions. Last month (September 2021), Merck & Co. agreed to acquire Acceleron Pharma, a Cambridge, Massachusetts-based bio/pharmaceutical company, for an approximate total equity value of $11.5 billion. The deal is expected to close in the fourth quarter of 2021.

Acceleron focuses on using the transforming growth factor (TGF)-beta superfamily of proteins that play a role in the regulation of cell growth, differentiation, and repair. The company’s lead drug candidate, sotatercept, is in Phase III development for treating pulmonary arterial hypertension (PAH), a blood vessel disorder. Sotatercept is in Phase III trials as an add-on to current standard of care for the treatment of PAH. In addition to sotatercept, Acceleron’s portfolio includes Reblozyl (luspatercept-aamt), an erythroid maturation recombinant fusion protein approved in the US, Europe, Canada and Australia for treating anemia in certain rare blood disorders. Reblozyl is being developed and commercialized through a global collaboration with Bristol Myers Squibb.

The other important move by Merck in 2021 was completing its divestment of its women’s health, legacy brands, and biosimilars business to form a separate, standalone company, Organon & Co.; the deal was completed in June (June 2021). The spin-off was done to allow Merck to increase its focus on key “growth pillars” in oncology, vaccines, hospital products, and animal health, achieve higher revenue and earnings-per-share growth rates and enable incremental operating efficiencies of approximately $1.5 billion, which are expected to be achieved ratably over three years, with approximately $500 million realized during 2021. In connection with the spin-off, Merck received a distribution from Organon of approximately $9 billion.

In addition, In April (April 2021), Merck completed its $1.85-billion acquisition of Pandion Therapeutics, a Watertown, Massachusetts-based company developing bispecific antibody therapeutics for autoimmune diseases. Merck had announced the acquisition of Pandion in February 2021. Pandion is advancing a pipeline of precision immune modulators. Its lead candidate, PT101, is an engineered IL-2 mutein fused to a protein backbone designed to selectively activate and expand regulatory T cells for treating ulcerative colitis and other autoimmune diseases. Earlier this year (2021), Pandion announced that PT101 had completed a Phase Ia clinical trial. The company’s pipeline also includes PD-1 agonists in development for numerous autoimmune diseases.

Sanofi’s $3.2-billion acquisition of Translate Bio and additional acquisitions. Sanofi added to its messenger RNA (mRNA) pipeline with its $3.2-billion acquisition of Translate Bio, a clinical-stage mRNA therapeutics and vaccines company, in a deal that was completed last month.

Translate Bio has an early-stage pipeline in cystic fibrosis and other rare pulmonary diseases. Its lead pulmonary candidate is being evaluated as an inhaled treatment for cystic fibrosis in a Phase I/II trial. Additional pulmonary diseases are being evaluated in discovery-stage research programs that use a proprietary lung delivery platform. Its technology may also apply broadly to a wide range of diseases, including diseases that affect the liver. Additionally, the platform may be applied to various classes of treatments, such as therapeutic antibodies or vaccines. Sanofi’s acquisition of Translate Bio follows recent collaborations between the companies. In June 2018, Sanofi and Translate Bio entered into a collaboration and exclusive license agreement to develop mRNA vaccines, which was further expanded in 2020.

Sanofi’s acquisition of Translate Bio is another recent acquisition by Sanofi to build its research mRNA capabilities. In April (April 2021), Sanofi acquired Tidal Therapeutics, a preclinical-stage bio/pharmaceutical company with a mRNA-based approach for in vivo reprogramming of immune cells, in a $470-million deal ($160 million upfront and up to $310 million in milestones).

Sanofi also announced or completed other acquisitions in 2021. Last month (September 2021), Sanofi agreed to acquire Kadmon Holdings, a bio/pharmaceutical company, for $1.9 billion to advance its transplant business. Kadmon’s pipeline includes drug candidates for immune and fibrotic diseases as well as immuno-oncology therapies. The deal is expected to close in the fourth quarter of 2021.

Also, in April (April 2021), Sanofi completed its acquisition of Kymab, a Cambridge, UK-based bio/pharmaceutical company, in a $1.45-billion deal ($1.1 billion upfront and up to $350 million in milestones). Kymab’s lead product is KY1005, in Phase IIa development, for treating atopic dermatitis and with potential therapeutic application in multiple diseases caused by immune dysregulation. It is a monoclonal antibody that targets OX40L, a regulator of the immune system. The company is also developing KY1044, in Phase I/II trials, for treating advanced solid tumors as a monotherapy and in combination with Roche’s Tecentriq (atezolizumab), an anticancer drug. The company is also developing KY1043, an immune checkpoint inhibitor for treating cancer and for which the company expects to file an investigational new drug application in 2021.

Amgen’s pending $2.5-billion acquisition of Tenebio and $1.9-billion acquisition of Five Prime Therapeutics. Amgen has been involved in two acquisitions thus far in 2021. In July (July 2021), Amgen agreed to acquire Teneobio, a Newark, California-based clinical-stage bio/pharmaceutical company developing human heavy-chain antibodies, in a deal worth up to $2.5 billion ($900 million upfront and up to an additional $1.6 billion in contingent milestone payments).

The acquisition includes Teneobio's bispecific and multispecific antibody technologies, which complement Amgen's existing antibody capabilities with the addition of a heavy-chain only platform that allows a sequence-based discovery approach for target binders. They also include Teneobio's T-cell engager platform, which expands on Amgen's existing position in bispecific T-cell engagers by providing a complementary approach to Amgen's current BiTE platform, a proprietary bispecific T cell engager platform. Also, in June 2021, AbbVie acquired TeneoOne, a Teneobio affiliate, which includes TNB-383B, an anti-CD3/BCMA (B-cell maturation antigen) bispecific antibody for treating relapsed or refractory multiple myeloma.

In addition, earlier this year (April 2021), Amgen completed its $1.9-billion acquisition of Five Prime Therapeutics, a South San Francisco, California-based company developing immuno-oncology and targeted cancer therapies, for approximately $1.9 billion. Five Prime’s lead asset is bemarituzumab, in Phase II development, for treating certain forms of advanced gastric or gastroesophageal junction (GEJ) cancer.

Horizon Therapeutics’ $3.0-billion acquisition of Viela Bio. In March (March 2021), Horizon Therapeutics, a Dublin, Ireland-based bio/pharmaceutical specializing in rare autoimmune and severe inflammatory diseases, completed its $3.0-billion acquisition of Viela Bio, a Gaithersburg, Maryland bio/pharmaceutical company also specializing in rare autoimmune and severe inflammatory diseases. Viela Bio was formed in 2018 as part of a spin-off from AstraZeneca’s MedImmune, its global biologics arm, which spun out Medimmune six molecules from its early-stage inflammation and autoimmunity program into an independent biotech company, Viela Bio. That relationship netted Viela Bio’s first drug approval by the US Food and Drug Administration in 2020: Uplizna (inebilizumab-cdon) for treating neuromyelitis optica spectrum disorder (NMOSD), a rare, severe, autoimmune disease that attacks the optic nerve, spinal cord, and brain stem, which leads to loss of vision and paralysis. As part of Horizon’s acquisition of Viela Bio, AstraZeneca divested its 26.7% stake in Viela Bio for $776 million.

Pfizer’s pending $2.26-billion acquisition of Trillium Therapeutics. In August (August 2021), Pfizer agreed to acquire Trillium Therapeutics, a Mississauga, Ontario, Canada-based clinical-stage immuno-oncology company, for $2.26 billion. In September 2020, as part of the Pfizer Breakthrough Growth Initiative (PBGI), Pfizer invested $25 million in Trillium and Jeff Settleman, Senior Vice President and Chief Scientific Officer of Pfizer’s Oncology Research & Development Group, was named to Trillium’s Scientific Advisory Board. Established in June 2020, PBGI’s goal is to provide funding for scientific research as well as access to Pfizer’s experts to ensure the continuity of clinical programs that could be of potential strategic interest for Pfizer. Pfizer has committed to providing up to $500 million in total funding to the PBGI.

Also, in April (April 2021), Pfizer acquired Amplyx Pharmaceuticals, a San Diego, California-based biopharmaceutical company developing therapies for people with compromised immune systems susceptible to fungal infections.

Perrigo’s $2.1-billion pending acquisition of HRA Pharma. Last month (September 2021), Perrigo agreed to acquire Héra SAS (HRA Pharma), a Paris-based over-the-counter (OTC) consumer self-care company, for EUR 1.8 billion ($2.1 billion) from funds affiliated with the private equity firm, Astorg, and Goldman Sachs Asset Management. The pending acquisition is part of Perrigo’s strategy to focus on consumer healthcare after divesting its generics business earlier this year (2021). In March (March 2021), Perrigo agreed to sell its generic prescription pharmaceuticals business to Altaris Capital Partners, an investment firm, for $1.55 billion. Perrigo first announced plans in 2018 to separate its prescription pharmaceuticals business, which consisted primarily of generic drugs, to focus on its OTC business.

Lilly’s $1.04-billion acquisition of Prevail Therapeutics and $1-billion acquisition of Protomer Technologies. Eli Lilly and Company has been involved in two $1-billion deals thus far in 2021. In January 2021, Lilly completed its acquisition of Prevail Therapeutics, a New York-based company developing gene therapies, in a $1.04-billion deal ($880 million upfront plus one non-tradable contingent value right worth up to $160 million). The deal was announced in December 2020. Prevail’s lead gene therapies in clinical development are: (1) PR001 for patients with Parkinson's disease with GBA1 mutations and neuronopathic Gaucher disease, which occurs in newborns and infants and is characterized by neurological complications due to the abnormal accumulation of glucocerebroside in the brain; and (2) PR006 for patients with frontotemporal dementia with GRN mutations. Prevail's preclinical pipeline includes PR004 for patients with specific synucleinopathies, as well as potential adeno-associated viruses-based gene therapies for Alzheimer's disease, Parkinson's disease, amyotrophic lateral sclerosis, and other neurodegenerative disorders.

Also, in July (July 2021), Lilly acquired Protomer Technologies, a Pasadena, California-based technology company specializing in engineering protein therapeutics, in a $1-billion deal (inclusive of undisclosed milestone payments). Protomer has a proprietary peptide- and protein-engineering platform used to identify and synthesize molecules that can sense glucose or other endogenous modulators of protein activity. The platform enables the development of therapeutic peptides and proteins with tunable activity that can be controlled using small molecules. Protomer has used this approach toward advancing a portfolio of therapeutic candidates, including glucose-responsive insulins that can sense sugar levels in the blood and automatically activate as needed throughout the day.

Bayer’s $2.0-billion acquisition of Vividion Therapeutics. In August (August 2021), Bayer completed its acquisition of Vividion Therapeutics, a San Diego, California-based bio/pharmaceutical company focused on cancers and immune disorders, in a deal worth up to $2 billion ($1.5 billion upfront and up to $500 million in milestone payments). Vividion’s lead programs include multiple oncology and immunology targets, with ongoing efforts on a transcription factor NRF2 antagonist for the potential treatment of NRF2 mutant cancers, as well as NRF2 activators for various inflammatory diseases, such as irritable bowel disease. Vividion’s proprietary chemoproteomic drug-discovery platform is used to identify selective small-molecule therapeutics targeting traditionally undruggable targets in oncology and immunology.

Also, in June (June 2021), Bayer agreed to acquire Noria Therapeutics, a company focused on the development of targeted alpha therapeutics and theranostic agents, and PSMA Therapeutics, a subsidiary of Noria, to advance the platform of prostate-specific membrane antigen-(PSMA) targeting radiotherapeutics. Through the acquisition, Bayer gains exclusive rights to a differentiated alpha radionuclide investigational compound based on actinium-225 and a small molecule directed toward PSMA.

Nordic Capital’s acquisition of Advanz Pharma. In June (June 2021), the private equity firm, Nordic Capital, closed on its previously announced acquisition of Advanz Pharma, a specialty bio/pharmaceutical company with operational headquarters in London. Nordic Capital had announced the acquisition in January (January 2021). The equity purchase price of Advanz Pharma was approximately $846 million. Including debt, the deal was valued at approximately $2 billion.

MorphoSys’ $1.7-billion acquisition of Constellation Pharmaceuticals. In a deal among smaller companies, in July (July 2021), MorphoSys, a Munich, Germany-based bio/pharmaceutical company, completed its $1.7-billion acquisition of Constellation Pharmaceuticals, a Cambridge, Massachusetts-based clinical-stage bio/pharmaceutical company developing therapeutics for cancers associated with abnormal gene expression.

Novo Nordisk’s acquisition of Prothena’s ATTR Drug Program in $1.2-billion deal. In July (July 2021), Novo Nordisk agreed to acquire from Prothena, a Dublin, Ireland-based bio/pharmaceutical company, PRX004, an anti-amyloid immunotherapy, and Prothena’s broader ATTR amyloidosis program, in a $1.2-billion deal ($100 million upfront and undisclosed development and sales milestones). ATTR amyloidosis is a rare, progressive disease characterized by the abnormal buildup of amyloid deposits composed of misfolded transthyretin protein in the body’s organs and tissue, most commonly in the heart and/or nervous system. PRX004 is a Phase II-ready anti-amyloid immunotherapy designed to deplete the amyloid deposits that are associated with the disease pathology of ATTR amyloidosis. Under the purchase agreement, Novo Nordisk acquires Prothena’s wholly owned subsidiary and gains full worldwide rights to the intellectual property and related rights of Prothena’s ATTR amyloidosis business and pipeline. Prothena is eligible to receive development and sales milestone payments totaling up to $1.2 billion, including $100 million dollars in upfront and near-term clinical milestone payments. Novo Nordisk will initially focus on the clinical development of PRX004 in ATTR cardiomyopathy, an underdiagnosed and potentially fatal form of ATTR amyloidosis characterized by build-up of amyloid deposits in cardiac tissue.

Other acquisitions.

Boehringer Ingelheim’s acquisition of Abexxa Biologics. Last month (September 2021), Boehringer Ingelheim (BI) acquired Abexxa Biologics, an Arlington, Texas-based bio/pharmaceutical company focused on immuno-oncology. The acquisition will allow BI to access Abexxa’s expertise in targeting cancer-specific proteins that are located inside the cell, rather than those expressed on the cell membrane. BI aims to develop cancer therapies by using Abexxa’s technology and antibody-based drugs.

Novartis’ acquisition of Arctos Medical. Novartis added to its gene-therapy portfolio with the acquisition of Arctos Medical, a Swiss start-up developing optogenetic adeno associated virus-based gene-therapies, in a deal completed last month (September 2021). Arctos developed its technology as a potential method for treating inherited retinal dystrophies and other diseases that involve photoreceptor loss, such as age-related macular degeneration.