In this week’s edition of InnovationRx, we look at biotech M&A, the rise of India’s Anthem Biosciences, and more. To get it in your inbox, subscribe here.
Pharmaceutical M&A reached $65 billion in the first quarter, its highest number since 2020, according to new data from PwC.
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Healthcare M&A is surging. The pharma industry saw $65 billion in deals for the first quarter of 2026, the highest figure since 2020, with 16 of them for $1 billion or more, according to new data from accounting giant PwC.
One big reason for all the dealmaking is the looming patent expirations for blockbuster drugs, among them Merck’s Keytruda and Bristol Myers Squibb’s Opdivo, that will cut into pharma companies’ revenue. The desire to fill that gap helps explain why many of this year’s acquisitions so far–including Gilead’s $8.2 billion acquisition of cancer biotech Arcelix, Lilly’s $7.8 billion buy of neurology-focused Cantesa Pharmaceuticals and Merck’s $6.7 billion deal for oncology startup Terns Pharmaceuticals–involve next-generation modalities that would be expected to have a long patent runway.
Despite political pushback, big pharma’s rush to license therapies from China keeps going as that country’s biotechs have moved from fast followers to increasing innovation. As the report notes, these companies “are looking to China for truly innovative molecules across oncology, immunology, and metabolic disease.” Large buyers can also get more favorable deal terms from Chinese startups than from American and European ones, the report’s authors note.
Expect more M&A activity over the next six months. Not only do the big pharma companies have reason to buy, but increasingly biotechs may be looking to sell because the IPO window remains tight, and mostly confined to those startups with drugs that are either approved or nearly through the clinical process.
Anthem Biosciences founder Ajay Bhardwaj
HARSHITH DAMBEKODI FOR FORBES ASIA
Over a two-decade career at Indian biopharma firm Biocon, Ajay Bhardwaj had climbed the ranks to become a key member of the senior management team, overseeing marketing. His boss was the company’s founder and chairman, Kiran Mazumdar-Shaw, a pioneer in Indian biotech and the country’s first self-made woman billionaire.
But when he was passed over for a promotion, he quit. At age 46 and with two children to put through university, Bhardwaj ploughed all of his savings into Anthem Biosciences, a provider of outsourcing services to pharma companies for all stages of drug development, in 2006.“It was a huge gamble,” says Bhardwaj in a March interview at company headquarters in an industrial hub near Bangalore’s outskirts.
It was also a timely one. Confronted by spiraling costs and declining success rates of bringing a new drug to market, pharma companies had turned to outsourcing as a cost-effective way to speed up the process. According to an Anthem-commissioned 2024 report from research firm Frost & Sullivan, only one in 10,000 to 15,000 compounds in preclinical trials gets FDA approval, while the time it takes to develop a new drug has more than doubled to over 13 years since the 1970s. For American pharma companies, outsourcing to Indian firms can save 75% on R&D costs and 55% on manufacturing.
Bhardwaj’s $9 million (at historical exchange rates) wager, funded by selling his 1% stake in Biocon and taking out a bank loan, has paid off several times over. Today, Anthem is one of India’s most valuable listed companies in the sector with a recent market cap of $4.5 billion. Its July 2025 IPO landed the 65-year-old founder on Forbes’ Billionaires list for the first time, with a net worth of $2.4 billion.
Now Bhardwaj is aiming for expansion, including earmarking funds to build a new factory near Bangalore, in an effort to nearly quintuple sales to $1 billion. Analysts estimate he could reach that goal in around seven years.
Read more here.
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