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Life Science M&A: A Pivotal Scientific Perspective

Sorcha Hermon

Apr 26, 2023

Exot Strategy 2

As a global biotech consultancy, Pivotal Scientific are well positioned to gain valuable insight across the breadth of the research and diagnostic reagent industries. Our latest blog evaluates the current M&A landscape.

Author: Sorcha Hermon In December 2022, Sorcha moved into the M&A team in an analyst capacity, where she contributes to Pivotal Scientific's successful buy and sell side activities.

Sorcha Hermon


As a global biotech consultancy, with an increasingly in-demand mergers and acquisitions (M&A) team, Pivotal Scientific Ltd are well-positioned to gain valuable insight across the breadth of the research and diagnostic reagent industries.

We are a truly end-to-end service provider, supporting companies whether they are at the start of their commercialisation journey, part way through seeking help to grow strategically, or towards to latter stages considering exit via sale, or inorganic growth via acquisition.

This puts us in a prime position to identify the current industry trends, recognise the market landscape and pinpoint key areas for future growth.

M&a Blog Image

Buy Side

Continued investment from PE and Multinationals

Post-pandemic there has been increased and sustained investment from private equity (PE) firms into the life sciences space, however the large multiples seen during and in the immediate aftermath of the pandemic have not stood the test of time. PE investment has come from both large and mid-range funds, with deal volume in the past five years in biopharma and life sciences tools increasing by 115% compared with the previous five-year period.1

This has been reflected in Pivotal Scientific’s output on a smaller scale case-by-case basis, with PE firms looking to build, ‘bolt on’ and diversify their portfolios into the life science reagents space. Key areas of interest for these PE firms, as well as larger multinationals, include, but are not limited to, cell and gene therapy, recombinant antibody capabilities and scalable protein expression, engineering and production.

We have seen strong interest in the acquisition of or investment in companies with effective technical capabilities and know-how, versus companies with large catalogue offerings and broad portfolios. This often materialises in those ‘bolt-on’ acquisitions, whereby smaller companies with novel technology and/or niche expertise are incorporated into larger entities to bolster existing capabilities. PE firms are recognising the importance of a core technical skillset to effectively integrate existing companies within their portfolios.

This, for example, is reflected in the increasing interest in companies with recombinant antibody discovery and production capabilities. As the market demands and regulation changes drive greater interest in recombinant technology, many are looking to convert existing monoclonal antibodies into recombinant formats, thus requiring an underlying engine to do so.

Regional bases & scalable facilities

Another space of interest is from expanding companies looking to establish bases in specific geographic territories or acquire new facilities to scale their current operations and serve customers at an accelerated pace.

A key example is US or Asian companies looking to acquire European bases. Specific regions of interest cover the life sciences clusters in Germany, Belgium, The Netherlands, and France. Investment in such facilities is dictated by several drivers, including ease of product distribution, ensuring compliance to new IVD-R regulations, and entrance into new markets.

As small and medium-sized companies grow, many are becoming restricted by the facilities and the resources in which they were founded.   With increased funding, movement out of the pre-revenue phase or strong sales growth, comes increased space and production requirements. Similarly, as hygiene standards continue to be of importance within our industry, many look to acquire GMP compliant or ISO certified facilities to ensure customer stickiness can be maintained as requirements change.

Identifying the right targets, determining their strategic focus, synergies, and addressability, can be challenging. Our team has extensive knowledge of and many personal connections to a global network of companies, ensuring that our target list development service saves your time by identifying those with the best fit to your business.

The missed opportunity

A significant proportion of life science manufacturers’ customer bases represent a key source of untapped opportunity.

Typically, 80% of revenue is generated from less than 20% of the customer base. This confirms that many companies have long tails of often accidental customers, only purchasing single products at a time, despite having complementary products that would be of interest to the customer within their portfolios. Our industry has yet to deploy the strategies needed to effectively target this customer type, with either more compelling and complete propositions or simply improved communication.

Often companies are unaware that their approach needs to change, or that they are missing opportunities to cross-sell or bundle products across their existing catalogue. Realising this at any stage is important, but particularly when looking to buy. Ensuring you’re leveraging your existing assets is key in maximising your initial investment, ahead of acquiring capabilities to replace or support what you have not yet achieved organically.

A large majority of our consulting service involves strategic and technical support in devising credible inorganic strategies and targets, along with advising our clients that inorganic investment should simply be a tool to fix what you can’t do organically through appropriate development.

Sell Side

Within the sell side of Pivotal Scientific’s operations, we see a considerable number of maturing SMEs looking for either guidance on growth by acquisition or exit, as key C-suite members of staff start to consider life after work. This materialises itself in a thriving feasibility study service by which we help our clients to understand their options going forward, supported by industry trends, and identify strategic benefits against risks and challenges.

Are you ready for exit? Fit for sale?

The outcome of such feasibility studies is often to move through to valuation and the full sale process of their organisation.

Whilst valuation is a key step in the journey to exit, it is also important for companies in providing a baseline for any further strategic development within their businesses. Companies who want to maximise ROI to stakeholders often need to weigh up whether now is the right time to sell, or the right time to invest in further development. Having a third-party, external valuation from our in-house financial consultants provides an unbiased view on your company, its features and uniqueness, and its prospects for the future.

Having helped in over 20 sell-side transactions since 2019, coupled with the deep industry knowledge and the personal experience of our M&A team, we can offer support throughout the sell-side timeline.

Strategic guidance for start-ups

Our sell-side arm also encompasses strategic plans for early-stage companies. Within this space, we are seeing smaller organisations wanting to expand commercialisation, and seeking guidance in best practice for maximising inward investment.

The importance of both deep commercial knowledge and strong scientific capabilities to provide experience and evidence-led strategy coupled with ‘blue-sky’ development thinking is not lost on us. With an M&A team of consultants experienced in both science and commercial sectors, we work to provide the best possible service to our clients, driving the best possible outcomes.

Final comments

The patterns discussed herein reflect a small segment of the wider market landscape and dynamics within the life science space. As we see continued evolution in investment and technology, new areas of opportunity will emerge, and keeping abreast of trends will be key for many companies in informing their growth strategies, exit plans and acquisition targets.

Pivotal Scientific recognise the importance of this, and our team of scientists and commercial experts are primed to identify and share these changes to our client base, helping us to provide the best service possible.

This summer, Pivotal Scientific will be releasing our 2022 Research Use Antibody Market Report, further shedding light on key industry trends, providing market sizing, drivers, challenges, and future opportunities. Keep an eye on our social media for the latest updates or register your interest here.

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