Burrill predicts mergers as crisis takes its toll

The same crisis afflicting Europe is likely to hit hard in the U.S. as well. Look for an "uptick" in the fortunes of the biotech industry during the annual JP Morgan Healthcare Conference in early January, says biotech banker Steven Burrill. And then watch out for the slide.

In his annual list of predictions for the year ahead, Burrill hit a distinctly downbeat note. Small public companies and private developers face the toughest challenge, he says, predicting a slate of mergers as biotech companies scramble to survive. Values will drop to bargain basement levels in many cases.

"Many will be forced to combine for survival and focus on the one key program between them that has the greatest opportunity for value creation and funding. In this respect, it will not be a 1+1=2 (combination) or 1+1=3 (synergy) but a 1+1=0.5," he writes.

Burrill also predicts that Roche will complete its acquisition of Genentech and several "marquee" names in the industry will be bought out as well. And consolidation will leave about 250 public companies in the arena.

- read the release

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