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JPM brings pharma firepower, but services quiet

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Jan 12, 2024
Illustration of a medical red cross under spotlights on a stage.

Illustration: Annelise Capossela/Axios

The JPMorgan Health Care Conference ended with more than $10 billion in deal announcements, setting a bullish tone for pharma and biotech M&A in 2024.

Yes, but: There was a notable lack of large-scale deal announcements in any health sector outside of pharma.

What they're saying: "JPM is a really good microcosm of the way that we talk about health care, where drugs are like 10 cents of every health care dollar but they're 90 percent of our conversation," a JPM veteran and PR adviser to several health care companies told Axios' Caitlin Owens.

What's happening: Alongside oncology deals, obesity drugs, and buzzy new technologies — yes, including AI — took center stage this year.

State of play: As is JPM tradition, several Big Pharma players made billion-dollar deal announcements this week.

  • Isomorphic Labs, a British drug discovery spinout of Alphabet, signed its first pharma partnerships with Eli Lilly and Novartis in deals that could be worth $3 billion, per Endpoints News. https://axios.link/3NYclUh
  • J&J (NYSE: JNJ) agreed to acquire Ambrx Biopharma (Nasdaq: AMAM), a San Diego-based, oncology-focused clinical-stage biotech company, for $2 billion. https://axios.link/48r0l5K
  • Boston Scientific (NYSE: BSX) agreed to acquire Axonics, an Irvine, Calif.-based neurostimulation device maker, in a deal valued at roughly $3.7 billion ($71 in cash per share), representing a 23.3% premium to Axonics' last close, per Reuters. https://axios.link/47r0Awv
  • Merck & Co. (NYSE: MRK) agreed to acquire Harpoon Therapeutics, a South SF-based pharmaceutical manufacturer, and its pipeline of T-cell engagers, for $680 million. https://axios.link/4aPhVlz
  • GSK (NYSE: GSK) acquired Forbion-backed Aiolos Bio, an SF-based biotech research company, for $1.4 billion, including $1 billion upfront and up to $400 million in milestone payments. https://www.aiolosbio.com/

Meanwhile, Walgreens CEO Tim Wentworth put the kibosh on near-term, big-ticket deals, noting the company is "not in a position where we can do large acquisitions," nor does it need to.

Zoom out: Leaders from Cigna and CVS — which each own two of the nation's largest pharmacy benefit managers — expressed confidence in the continued value of PBMs, despite likely policy reform.

Flashback: Recall that CVS Health made the biggest dealmaking splash in health services at last year's conference.

The bottom line: Anyone expecting health care services and tech M&A to pop on the tail of JPM may be disappointed this year.

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