Bankers expect more Japanese-led M&A

Yesterday, we heard that analysts are expecting more hostile bids to heat up pharma M&A. However, experts now are predicting that Japanese drugmakers will become bigger players in pharma dealmaking. 

Japanese drug firms have been looking outside their borders for some time now, snapping up foreign companies to beef up operations in international markets. Daiichi Sankyo bought Indian generics leader Ranbaxy Laboratories, and Astellas Pharma spent $4 billion on OSI Pharmaeuticals.

It's that latter deal that has some market-watchers most interested. It was a hostile bid, not a typical tactic for Japanese companies. "If someone had told me 10 years ago that a Japanese company would do a hostile offer in the United States," Peter J. Solomon Vice Chairman Frederick Frank told Reuters, "I'd have said they need psychiatric help."

Given market conditions, the companies' more aggressive stance should continue, the bankers said. But unless Japanese pharma companies consolidate among themselves, they won't be large enough to do really big international deals. And there could be a number of impediments to that, as Evercore Senior Managing Director Francois Maisonrouge pointed out.

- see the Reuters story

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