Merck Is “Open” To M&A (And License Deals) — Outside Its Core Focus Areas: Chairman Frazier, Yesterday

To be sure, Kenilworth is in an enviable position in 2016 — it has kept its powder dry, for quite a while now. Its balance sheet is immaculate, and its cash flow is. . . prodigious.

So it makes good sense that it might get acquisitive, here in later 2016, with bio-science deal asking prices declining slightly (think more value for the spend). Especially so if — as Mr. Frazier says — the deal is for strategic (as opposed to purely financial engineering/tax-driven) — reasons.

Here’s Forbes reporting, this morning — from yesterday’s Q1 2016 earnings call:

. . . .During Thursday’s call, Goldman Sachs analyst Jami Rubin pressed Frazier on the possibility of upcoming deals, including the type of investigational drug candidates and companies that Merck may be interested in purchasing. . . .

“[W]e have a strong balance sheet and we can go after deals across the whole spectrum, early, middle, and late-stage compounds,” Frazier responded. . . .

“And we will look for those deals consistent with good science and financial discipline. So we want to be aggressive in going after deals, but we want to do deals that create value for our shareholders. . . .”

Frazier was also careful to note that cancer drugmakers aren’t the only targets in Merck’s crosshairs. “It’s also important for us not to be too blinded to the fact that there’s important science going on in other areas, and so what we want to look for are significant opportunities to have leading positions in growing areas of therapeutic significance going forward,” he said. . . .

Do go read it all — and I won’t belabor (too much!) how different this approach is, from Mr. Ian C. Read’s, over at Pfizer. And smarter, to be sure. Onward on a warm sunny Friday, now!


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