With big pharma continuing to face loss of exclusivity events across various therapeutic areas, we believe 2024 will be another strong year for big pharma to plug portfolio gaps through M&A.

The rise of GLP-1s has created tremendous opportunities for obesity and obesity-related assets. We predict that pharma companies will seek out superior obesity drugs or complementary assets and flock to “GLP-1 resistant” therapeutic areas, and we think MedTech companies may search for assets that are not impacted by GLP-1s or assets for which an increase in longevity could portend an increase in utilization.

As AI continues to broadly disrupt all sectors of the economy, we believe life sciences companies will revisit AI opportunities. Our clients have expressed renewed interest in the space, and we have seen several AI-based drug development partnerships signed in Q3 and Q4.

Throughout 2023, we saw many big pharma companies rethink their portfolios. This entailed divesting assets to smaller companies and retaining minority stakes, as well as selling pipeline assets to other big pharma companies. Given a few high-profile successes, we think this trend will continue in 2024.

After slow periods in 2022 and 2023, we think the flurry of divestitures being used to reduce debt and improve capital structures across the industry over the past two years will lead to MedTech companies returning to growth M&A.