Stephenson Harwood’s Life Sciences & Healthcare team partnered with BiotechTV to discuss the key trends affecting investments into life sciences and healthcare companies, with a focus on cross-border and complex deal structures, exits and disputes. Please watch here for more details on:
- The increasing complexity of deal structures, with more crossover between equity and licensing.
- Strategic decisions around partnering lead or alternatively backup assets, and how these impact future exit opportunities. The lead asset drives more immediate value, but then you risk having less value left for future M&A, or at least it makes future deals more complex.
- The market is seeing more deals with combinations of products, especially in precision medicine, which makes structuring more complex. Major considerations include how IP rights are shared, and who is responsible for future patent filings and potential enforcement.
- The importance of thorough due diligence and understanding corporate structures, especially in cross-border deals with China and the Middle East. We have moved away from a market where it was relatively easy to pick up good value Chinese assets, as the quality of China-related data improves. In the Middle East, there is an emphasis on the Saudi Arabian market, and that country’s aims to prioritise bringing opportunities into the region rather than investing externally.
- Market trends such as the growing focus on longevity, health, and opportunities in emerging regions.
- Key negotiation points, including deferred consideration, milestones, and the need for competitive tension in deal processes. There has been and an increase in dual track (M&A or licence) processes.
- The rise in disputes over royalties, milestones, and IP ownership, and how clear drafting can help avoid litigation. Recently we have seen more litigation in which significant damages have been awarded for breaches of reasonable endeavours diligence obligations, so those are clauses that can have teeth and need to be managed from the outset.
Our team also shares practical tips on how to navigate these challenges and highlights how Stephenson Harwood can support you with cross-border expertise and sector insight. If you have any questions or would like to discuss any of the topics covered, please don’t hesitate to get in touch.
