The pharmaceutical sector recorded deals worth over $2.1 billion so far in 2018, compared with $1.9 billion across the 12 months of 2017. The spike in activity could be attributed to Aurobindo Pharma Ltd’s agreement to acquire the dermatology business and three manufacturing units of Sandoz for $1 billion, which is the largest outbound deal by an Indian pharmaceutical company. While the pharma segment witnessed a decline in deal volumes, a key trend emerging is the inclination of investors to place selective, yet large bets, to support inorganic growth. Strategic M&A (mergers and acquisition) deals alone accounted for nearly 70% of the deal activity in 2018, with outbound deals continuing to be the dominant focus area for Indian companies. These acquisitions provide access to new markets or further scope of value addition in existing markets. The US market remained a strategic priority as demonstrated by the big-ticket acquisitions by Lupin and Cipla in recent years.

(Live Mint)