Health-Care M&A: Private Equity Taking Its Medicine

May 7 - Deal Journal Blog (WSJ) - Can private-equity money help cure the ills of the pharmaceutical industry?

The ancient Greek word “pharmakon” referred both to the illness and its cure, and that duality captures the dilemma the pharmaceutical industry is confronting now: Many companies are facing a host of patent expirations on cash-cow, brand-name drugs at the same time that the pipeline of new blockbuster drugs has dried up. That means the industry needs money to reinvest into drug development.

One way to raise that money is by divesting businesses that aren’t core. And lo and behold, private-equity firms that can’t find the debt to make giant acquisitions are very willing to pop some of these smaller pills. Read More.