S.Korean biopharmaceutical sector to see brisk M&As in H1, 2023

An expert says the first half of next year will see the start of brisk M&As in biopharmaceuticals targeting strategic investors.

Pyeon Jae-seong, a senior manager at the consulting firm Deloitte, on Tuesday discussed trends and prospects of the bio industry at a seminar held at the hotel Courtyard by Marriott Seoul Pangyo in Seongnam, Gyeonggi Province, hosted by the Korea Biotechnology Industry Organization.

He based his forecasts on the securing of intellectual property (IP), cash assets of pharmaceutical corporations and investor focus on the prospects of new drug success.

The weight of biopharmaceuticals is shifting from chemistry to bio and from health care to management of specific diseases, he added, so more M&As to secure IP are expected given the growing importance of securing original technology.

In the COVID-19 era, the cash holdings of large global companies in pharmaceuticals late last year reached a record-high $201.4 billion (260 trillion won), and several of these companies during the pandemic appeared in Korea, he cited as further evidence to support his predictions.

In addition, investors have shifted their focus away from the pipeline and toward the commercial prospects of new drugs, he added, as they reevaluate corporate value.

"The value of biopharmaceutical corporations is converging to a range needed for strategic investors to invest," Pyeon said, urging investors to secure funds to prepare to grab forthcoming opportunities.

Write to Jae-Young Han at jyhan@hankyung.com