Life Science / Pharma & Chemicals

The Life Science and Pharma markets remain the most regulated markets worldwide. Each country independently governs approval of new medication, therapeutics, diagnostic means or adjuvants. FDA approval, or comparable market admittance, and patent protection frequently have substantial impact on the valuation of an enterprise in this sector. This applies to the entire range of players in this field from biotech companies, with an innovative oncologic approach, to companies focusing on medical imaging technology.

The trend for personalised medication – starting in developed countries and further increasing the financial burden on public and private health systems – will lead to additional consolidation in this field, also driven by the demographic factor.

Annual sales in the chemical-pharmaceutical industry in Germany in 2011 accounted for more than €184 bn and continue to grow. Large conglomerates as well as mid-sized companies contribute to the German position as “Exportweltmeister” (“world champion in exports”) in this field. According to PROGNOS research institute, German chemical production will increase by more than 40% by 2030. In terms of demand, Europe will remain the most important geographic market for German chemical producers. As the chemical exports from Germany to China are still at a very low level (less than exports to Austria for example), broadening the trade with Asia and South America will remain key to growing exports. German “Mittelstand” with its specialty chemicals will constantly grow in that environment. Driven by European REACH legislation and new ruling for small volumes 1-100 t p.a. to be fulfilled until 2018 and increasing energy prices, cost pressure will increase and this will lead to a further consolidation trend in this sector in future.

Based on two decades of experience in this field, we support our clients in dealing with different local market environments. We advise on global M&A strategies as well as transaction financing and portfolio strategies.

Are you doing business in this sector or are you interested in this field? The C▪H▪Reynolds sector team lead by Stefan Constantin is looking forward to your enquiries.