Is M&A activity good or bad for pharma jobs?
Job Search Job Search Tips

Pharma Acquisitions & Mergers: Good or Bad for Pharma Jobs?

Is M&A activity good or bad for pharma jobs?Mergers and acquisitions happen all the time with companies; they’re simply a part of business.  The pharmaceutical world has definitely seen its share of these buy-outs, and depending on your perspective, it can either be for the better or for the worse.

There were approximately $220 billion in pharmaceutical deals made during the first half of 2015, which was triple the amount during the first half of 2014, according to a recent report from consulting firm KPMG. But why such a rush for these companies to make such blockbuster deals?

Some experts claim it’s a combination of investor pressure and a narrowing window of opportunity.  Many pharmaceutical companies believe that acquisitions are the only way to keep revenues growing as fast as their investors expect.  And with today’s complex breakthrough medicines, it’s often cheaper for a company to acquire the next big drug than to develop in-house.

That being said, what have been some of the highlights of the merger/acquisition boom of 2015?

  • Teva Pharmaceutical Industries said it would buy Allergan’s generic business for $40.5 billion while dropping its “hostile” bid for Mylan.  Allergan said it would buy the biopharmaceutical firm Naurex for $560 million.
  • Johnson & Johnson accepted a binding offer from Cardinal Health to acquire its vascular research technology, Cordis, for an approximate value of $2 billion
  • Pharmaceutical wholesaler AmerisourceBergen said it plans to buy MWI Veterinary Supply for approximately $2.5 billion in a bid to expand into the animal health products market.

From an ownership standpoint, merging with or acquiring a company or brand (as long as it can be obtained at a reasonable price), is generally a smart decision.  By doing so, you can combine resources while eliminating some of your competition.  From an employee’s view, specifically a pharmaceutical sales rep, opinions may vary.

Pharmaceutical sales jobs are generally well-paying, incentive-laden occupations that are quite attractive to many employees in the workforce.  Those reasons alone are cause for high competition.  Throw in the shrinking number of pharmaceutical and other medical companies, as evidenced by 2015’s merger and acquisition rush, and there will definitely be many sales reps that are worried about job security and the future of their industry.

On the other hand, larger companies that are worth billions of dollars, for instance, typically require a larger staff and more opportunities for growth.  Pharmaceutical and medical sales reps are directly responsible for this growth and are an important link between not only a company and new clients, but a company and its existing clients as well.  With that logic, it would appear that many sales reps’ jobs are in fact, not, in danger.

“It’s understandable that reps may be skittish about mergers and acquisitions,” says Shaun McMahon, President and Founder of Illuminate, a Boston-based leader in pharmaceutical, biotech, and medical device sales training. “But reps often stay with the merger or acquisition. The job may be getting tougher, but it’s one that the industry still needs.”

Top pharmaceutical sales representatives will find a way to be successful in virtually any climate. They view any change in the medical and pharmaceutical fields as a challenge, knowing that many of their colleagues won’t feel the same way or be up to the task.