Day in the Life of an Experienced Dealmaker

By Dylan Kissane

Three dealmakers from different biopharma companies, the smallest of which has more than 12,000 employees, share insights on their dealmaking processes. Little wonder this proved one of the most popular panel sessions at BIO-Europe, with standing room only at the Leipzig Messe.

Co-moderated by Evonne Sepsis and Anton Gueth, Managing Directors at ESC Advisors and EVOLUTION Life Science Partners, respectively, the panel shared their views on everything from the current industry outlook to their dealmaking interests and their predictions for 2023 and beyond. The conversation was animated between Jenny Laird, VP of Search & Evaluation Neuroscience at Eli Lilly and Company, Matthias Müllenbeck, Head of Global Business Development & Alliance Management at Merck KGaA, and Nouhad Husseini, VP BD at Regeneron. Still, Müllenbeck’s explanation of Merck’s ambitious short-term goal got things moving.

Merck has publicly announced a goal of 25 by ’25, meaning $25 billion in revenue by 2025. Müllenbeck said that this target directly impacted the sorts of deals that Merck pursues. While a large part of that revenue target would be via organic growth, a significant amount would come from non-organic growth via acquisitions and partnerships, including late-stage deals. This does not mean that Merck is looking for ‘big bang’ deals, as its focus remains on signing partnerships that will fill gaps in the company pipeline.

Laird noted that this gap-filling strategy is Lilly’s approach, too. She offered the example of Alzheimer’s research, where Lilly has been making advances for some 30 years. Lilly now seeks external innovation partners to complement its current and future work. Depending on the therapeutic area, the proportion of Lilly’s portfolio sourced from outside the company can soar. Nearly all the assets in Lilly’s pain and migraine portfolio have been developed with external partners.

The moderators quizzed the dealmakers on how the financial markets have impacted their day-to-day activities, specifically, how the economic downturn and ‘buyer’s market’ have shifted the landscape. For Husseini, the answer was that nothing changed: a low price was rarely the reason for doing a deal before the downturn and wouldn’t impact any decisions now. Regeneron enters a negotiation expecting to pay a fair market price for assets and not take advantage of the person across the table.

Müllenbeck agreed with paying a fair market price but added that, right now, the fair market price is much lower than it was a year ago. “The reality has simply changed,” he said, and the impacts of inflation and high-interest rates are far from over. Laird, however, was more optimistic about the future of dealmaking, at least in the neuroscience sector. “It’s going to be a year of growth,” she said. With new data and Lilly’s diabetes business growing, Lilly is looking forward to 2023. Husseini, though, was happy to hedge his bets on what was to come. “We’re going to be here next year, and it is going to feel the same as it does now,” he predicted. “It won’t be a lot worse, but it won’t be a lot better.”