ABSTRACT
Pharma companies increasingly focus their research and development (R&D) efforts towards unmet therapeutic needs and under-exploited niches, but the large firms only generate about 20% of the drugs in phase III clinical trials (Kourouklis, 2021). Most of the successful products find their origins in small pharma (<$500 million) companies, where R&D is centred on a handful of core technologies. This trend drives mergers and acquisitions (M&As) in Pharma/Biotech, with large firms often acquiring the smaller ones. This begs the question, though, when should a firm invest in internal R&D, and when should they go the M&A route?
