Eoin Treacy's view -
Gilead Sciences Inc. has so far been silent on plans to diversify its pipeline as investors clamor for a repeat of last year’s biotech deal boom.
The drug developer leads a group of biopharmaceutical companies that Wall Street expects to join in the sector’s acquisition spree. Earlier on Friday, Eli Lilly & Co. snatched up Dermira Inc. and its skin disorder drug for $1.1 billion.
That news comes as investors and management flock to San Francisco for the JPMorgan Healthcare Conference, which kicks off on Monday. The meeting is viewed as the crown jewel of sell-side events and is a hotbed for companies to announce deals and provide product updates.
The biotech sector is busy commercialising a range of novel therapies to treat cancers and chronic conditions like diabetes, Alzheimer’s and arthritis. The road to full approval and the scope for failure along the way means it is a high-risk strategy to invest in start-ups. Therefore, the bigger companies wait for some verifiable proof a nascent product works and then investigate buying it.
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