Takeovers in the biotechnology sector are running at a record level so far this year and they are expected to gain in importance over the next few years.
A report in the German newspaper Handelsblatt in the wake of Abbott Laboratories' acquisition of Kos Pharmaceuticals for $3.7 billion (see page 2) estimates that the volume of biotechnology takeovers in 2006 has exceeded $30.0 billion - more than double the volume that was recorded in 2005. A significant contribution to this year's record came from the $13.3 billion takeover of the Swiss Serono group by Merck KGaA and Novartis' purchase of Chiron (Marketletters passim) and takeovers were the main theme of this year's BIO Europe conference, held in Dusseldorf, Germany this month.
Roger Longman of the Windhover Information Service says the main driver of the trend is pharmaceutical majors' need for new products and technologies. Mr Longman adds that the majors are not currently developing enough new molecules to sustain growth.
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