Big Pharma Diversification Strategies Report 2018: Roche, Johnson & Johnson, and AstraZeneca - Active Acquirers in their Focused and Diversified Visions - ResearchAndMarkets.com

DUBLIN--()--The "Big Pharma Diversification Strategies" report has been added to ResearchAndMarkets.com's offering.

Pressures ranging from continually declining revenues as a result of generics and impending biosimilars launches, to slow R&D productivity and market access restrictions could cause the Big Pharma peer set to evaluate business opportunities beyond pharmaceuticals. A large majority, approximately 77%, of Big Pharma's total annual revenues between 2013 and 2017 were from prescription drugs, and more than half of Big Pharma's M&A activities, as well as its divestments, focused on pharmaceuticals as well.

Using a measurement called indicative profit potential (IPP). The author has determined that remaining focused on pharmaceuticals is still the most profitable strategy, although there is no direct correlation between the level of pharmaceutical focus, based on revenue proportion, and operating margin.

Still, multiple challenges, including the continuing generic erosion of sales and impending biosimilars launches, could force Big Pharma to evaluate diversified markets as a way to offset losses and grow other businesses. For instance, M&As in the area of diagnostics have been seen to be growing.

There are a broad range of diversification, or non-diversification, strategies currently employed by the Big Pharma peer set, ranging from the more focused, as demonstrated by Bristol-Myers Squibb and Pfizer, to intermediately focused companies, including Eli Lilly and GlaxoSmithKline, to extremely diversified firms such as Johnson & Johnson. The best option for diversification might be a mixture of both strategies, including a focus on pharmaceuticals alongside expansions into markets such as devices and diagnostics.

Indeed, the devices and diagnostics sector has the second-highest IPP following prescription pharmaceuticals, potentially making it the most attractive option if a diversification strategy were to be pursued. Meanwhile, markets such as pharmaceutical wholesalers and animal health are found to be the least attractive into which the peer set could diversify.

Key Topics Covered:

OVERVIEW

INTRODUCTION

Insights and recommendations

Bibliography

DIVERSIFICATION ANALYSIS BY REVENUE

Insights and recommendations

Prescription drug revenue makes up the majority of Big Pharma sales

Biologics are taking away share from small molecules

Bibliography

DIVERSIFICATION ANALYSIS BY M&A AND DIVESTMENT ACTIVITY

Insights and recommendations

Many factors contribute to a decline in M&A and divestments following a two-year increase

Deal values followed a similar trajectory to volume

More acquisitions and fewer divestments of non-pharma-focused businesses over time

Prescription pharma markets are the mainstay in M&As and divestments

Roche, Johnson & Johnson, and AstraZeneca: active acquirers in their focused and diversified visions

Merck & Co and Novartis divested several diversified assets

Developed markets are where Big Pharma does virtually all acquisitions

Bibliography

DIVERSIFICATION OPTIONS AND PROFITABILITY

Insights and recommendations

Focused, intermediate, and diversified strategies have each paid off

If diversifying, the best option could be devices and diagnostics

DIVERSIFICATION CASE STUDIES

Pharma-focused case studies

Diversified case study

Intermediate case studies

Bibliography

HEALTHCARE LANDSCAPE OVERVIEW

Prescription branded pharmaceuticals market

Devices and diagnostics market

Health insurance market

Over-the-counter/consumer health market

Generics market

Retail pharmacy market

Hospitals market

Pharmacy benefit management market

Pharmaceutical wholesaler market

Animal health market

Bibliography

APPENDIX

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Related Topics: Pharmaceuticals

Contacts

ResearchAndMarkets.com
Laura Wood, Senior Manager
press@researchandmarkets.com
For E.S.T Office Hours Call 1-917-300-0470
For U.S./CAN Toll Free Call 1-800-526-8630
For GMT Office Hours Call +353-1-416-8900
Related Topics: Pharmaceuticals