Hot Topic: M&Ad for it!

With many people on holiday right now, it’s good time to take stock of 2026 so far and look ahead to the rest of the year. 

The first half of 2026 has been really strong. The XBI index gained 23% and – more pertinently for privately-held biotechs – there was huge amounts of M&A going on. 

From January to June there were 33 deals worth more than $1 billion – according to Drug Discovery News – including three at the end of June worth $10 billion or more apiece.  

The total M&A deal value in those six months was $134 billion, which was more than the figure for the whole of 2025. 

SV Health Investors’ Charles Dunn gave a similarly upbeat assessment on Optimum TV recently, saying the market in 2026 was “hugely more positive” than in recent years, with “an unprecedented wave of M&A activity”. 

As for the rest of the year? 

Drug Discovery News is optimistic. It’s predicting that with the patent cliff still pressing, the second half of 2026 will bring “more of the same”. 

Journalist Andrea Corona added: “Programs with strong mechanistic differentiation, early clinical signal, and clear patient selection logic remain the most attractive acquisition targets.” 

In other words, not everyone is a red-hot target. Most still have work to do selling what they have to offer, frankly. 

Other commentators are striking at least a minor note of caution. 

In a mid-2026 “half time report” titled Don’t Stop Me Now – I’m not going to sing that – RBC Capital Markets says: “We do wonder if we might be in the later innings of this M&A cycle”. 

Lots of big pharma firms like Novo Nordisk, Merck, Lilly, J’n’J and AstraZeneca do still have lots of dry powder to deploy, RBC Capital Markets said. 

But other pharmas have either already covered most of the revenues that are at risk from patent cliffs with the deals they’ve already done or have less capacity for a major deal, RBC says. 

RBC believes deals will still happen in late 2026 – I think we can all agree on that – but the “frenetic pace” of the first half of the year is unlikely to persist. 

Well, it’d be hard to match, wouldn’t it?