Fig. 1| The top 50pharmaceutical companies (ranked by 2016revenues) withfive ormore intheoncology buy-side transactions to contributor thisincrease couldbetheapprovalOne important thefirstthree during years( ofthisperiod inactivity a steep rise $220 billion. annual growth rate ofmore than12%to reach avalueofalmost highest grossing therapy area until2022,expandingatacompound 2017,EvaluatePharma forecastedIn thatoncologywillremain the growthcurrent dominanceandexpected intheoncologymarket. highest numberofdeals( andSanofi—for whichoncologywasnottheareaNovartis withthe 2017, there were only5—Astellas, Gilead, Ingelheim, Boehringer in thetop indealmaking 21companiesmostactive June 2017).Of thera­ landscapeforOncology continuedto dominate thedealmaking Dowden Helen and Munro Jamie this feature,In authors at Clarivate Analytics explore therecent trends inoncology deals. accounted oncology for licensing 32 of the35multibillion-dollar deals of thelast five years. Oncology is currently the leadingarea for dealmaking, driven by immuno-oncology, which Trends dealmaking oncology in therapeutic area focus initiated between January 2017 and December 2017. See 2017.See 2017andDecember therapeutic area focus initiated January between area in2017.

Therapy areas from 2013to 2017( A review ofoncologydealmaking Musculoskeletal Gastrointestinal Endocrinology/ Cardiovascular peutics in2017,asitdid2016( Inflammatory Hematologic Neurology/ Respiratory psychiatric Diversified metabolic Oncology Infection Immune Other

The transactions assessedinclude allmergersThe and acquisitions, transactions licensingdeals, jointventures andresearch-only deals witha Bristol-Myers Squibb Merck & Co. 15 2 1 1 1 1 Fig. 1 15 1 Takeda

Merck KGaA driver here ispresumably). Akey the 1 4 2 2 9

Johnson & Johnson BioPharma 9 Roche 1 1 1 7

Dealmakers Ono PharmaceuticalAstraZeneca 1 1 1 1 3 4 3 5 Box 1 Box 2 1 2 2 1 5 ) shows ) shows

Daiichi Sankyo B3–B5, Fig. 2 1 1 1 5 ). ). 1 1 Celgene 5 Keytruda (pembrolizumab) Squibb’s andBristol-Myers Keytruda Opdivo inhibitors—Merck &Co.’s PD1–PDL1checkpoint of thefirsttwo valued at$8.5billioninclusive ofcontingentpayments, isa key ( thetotal valueofthesedealshasbeenmaintained Nevertheless, inthenumberofPD1orPDL1combinationtherapy options. plateau oftaxchangesintheUSandpotentialawaiting theimpact Possible thatmay factors have includecompanies contributed decreased compared withthelevels in2015(–6%)and2016(–4%). when usedincombinationwiththesedrugs. for moleculesandtechnologies thatcouldoffer synergistic benefits inhibitors, notonlyaround butalso of dealmaking, othercheckpoint (nivolumab)—in thesecondhalfof2014,whichaccelerated awave Fig. 2 2 3 4 In 2017, the volume of oncology dealmaking wasslightly 2017,thevolume ofoncologydealmaking In AbbVie ). The AstraZeneca July2017dealbetween andMerck &Co., Box 1 Box 1 1 1 1 4

Boehringer IngelheimPfizer for detailsofthedata. 1 1 1 3 Bayer 1 1 3 1 1 1 1 1 3 1 2 Eli Lilly 1 1 1 1 1 Novartis 2 1 1 2 1 2 1 Astellas 1 1 2 1 Gilead biopharmadealmakers.nature.com |March 2018 | 1 3 1 Sanofi 2 1 2 5 2

Total 10 14 19 16 96 2 3 7 4 4 6 7 9

Number of transactions B3 B3

Meletios Verras/Thinkstock/iStock

feature feature B4 in any given year. Without thisdeal, theoverall total dealvaluefor theoverall valueofdealmaking dealcanskew a multibillion-dollar nies’ how PD1-specificandPDL1-specificantibodies—demonstrates inhibitor selumetinib,kinase usedincombinationwiththecompa tion of AstraZeneca’s PARP inhibitor Lynparza and MEK1/2 (olaparib) tocontributor thistotal. This deal—focused ontheclinicalevalua the data. increased substantiallyfrom 2013to 2015.See deals by volume andvalue from 2013to 2017. Fig. 2 |Licensing, joint venture andresearch-only oncology Table 1|Oncology licensing, joint venture andresearch-only dealsvalued at more than$1billionfrom 2013to 2017 Celgene Eli Lilly Amgen Bayer Sanofi Celgene Shire (Baxalta) Shire (Baxalta) Eli Lilly Servier J&J Novartis Sanofi Celgene Pfizer Pfizer Celgene Incyte Merck &Co. BMS Merck &Co. Licensee

|March 2018 | Number of deals 100 150 200 250 300 350 400 50 0 2013 Licensing volume biopharmadealmakers.nature.com BeiGene BiologicsInnovent CytomX Loxo Oncology BioNTech Acetylon Precision BioSciences Symphogen CureVac Pieris Pharmaceuticals Aduro BioTech Xencor Regeneron Jounce Merck KGaA Cellectis OncoMed Merus Ablynx CytomX AstraZeneca Licensor 2014 2015 Total value($millions) 2016 2017 2015 2017 2017 2015 2013 2016 2016 2017 2017 2014 2016 2015 2016 2014 2014 2013 2016 2014 2014 2017 Year Box 1 Box 2017 Activity Activity for detailsof products inChina Anti-PD1 antibody, ofCelgene’s andmarketing andanti-CD20) Bispecific antibodies(incl. anti-cMet bispecific antibodies T cell-engaging inhibitors tyrosinekinase selective Next-generation mRNA-based immunotherapies HDAC inhibitors (incl. optionto acquire Acetylon) technology genome-editing Allogeneic CAR T celltherapiesusingARCUS inhibitors Checkpoint Cancer vaccinesusingRNActive technology technology Bispecific therapeuticsusinganticalinplatform platform Cancer vaccinesusingLADDimmunotherapy Bispecific antibodies Antibodies againstLAG3, GITRandPDL1 therapies I-O PD1/PDL1 development,ofXalkori andco-promotion CAR T celltherapies Anti-stem cellproducts, incl. bispecificantibody Bispecific antibodyplatform proteins nanobodiesagainstcheckpoint Multispecific usingProbodyImmunotherapies Platform PD1/PDL1 small-moleculecombinations Technology/mechanism ofaction

35,000 0 5,000 10,000 15,000 20,000 25,000 30,000 40,000 Total projected deal value ($ millions) ($ value deal projected Total - - X-Body, AbVitro and Redox) for less than $400 million intotal. This sup acquireractive from four 2013to 2017,acquiring companies(ZetaRx, ofthevolumeterms ofM&Aactivity. Juno Therapeutics wasthemost ceutical companies. However, smallercompanies are in justasactive pressure from biosimilars. to diversifyof Pharmacyclics from itsHumirafranchise, whichfaces near-term revenue generation,suchasAbbVie’s $20billionpurchase third of these large deals are strategic acquisitions aimed at portfolio Additionally, and Roche–Ignyta). Amgen–Onyx approximately one- inhibitors (AbbVie–Pharmacyclics, tyrosine kinase Takeda–ARIAD, andfourand Genentech–Seragon) deals focused onsmall-molecule therapies(Pfizer–Medivation, &Johnson–Aragon Johnson cancer three large deals focused hormone-based on next-generation Squibb,deals madeby Bristol-Myers GileadandAstellas, there are areperiod more diverse ( withinthesametimemerger andacquisition(M&A)transactions therapies. contrast, the drivers behind the In 14 largest oncology emerging platforms, antigenreceptor suchaschimeric (CAR) T cell 35 deals, 32are focused onimmuno-oncology, andmany involve withatotal valueinexcessperiod of$1billion ( the pastfive years, butthere are anadditional34dealsinthistime $15 billionfor thedealssigned in2013. average oftheprevious three years butstillmuchhigherthanthe 2017 isapproximately $20 billion,substantiallybelow the$31billion ment of the lead asset at the time of deal-signing, 58% of deals were company, acquisitiontarget itanattractive itself. making its development intoported a fully integrated cancer immuno Multibillion-dollar M&A transactions are dominated M&Atransactions by large pharma Multibillion-dollar The AstraZeneca–Merck &Co. dealisthelargest recorded within In terms of the distribution oflicensingdealsby phaseofdevelop ofthedistribution terms In Table 2 ). Aside from the immuno-oncology ). Aside from theimmuno-oncology Phase 1* Phase 2 Discovery Phase 2 Discovery Phase 2 Discovery Discovery Discovery Discovery Discovery Discovery Phase 1 Discovery Phase 2* Discovery Phase 2 Discovery Discovery Discovery Launched lead asset Phase of Table 1 ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓ I-O ). Of these ). Of therapy ­therapy 1,393 1,456 1,465 1,550 1,560 1,700 1,705 1,775 1,803 1,831 1,999 2,560 2,665 2,824 2,850 2,855 3,332 3,700 4,563 5,028 8,500 ($ millions) Total - - - 263 56 40 400 Undisclosed 600 105 175 50 31 12 150 640 225 850 80 155 120 27 50 1,600 ($ millions) Upfront the licenseelist,butalsothatahandfulofthesemajorplayers figure reveals notonlythatlarge companiesdominate pharmaceutical upfront payment was$17million). analyzed$200 millionover period (of whichthemedian thefive-year total value( stage. Nonetheless,signed stillhadasignificant atthediscovery they J&J, L,launched; P, &Johnson; the assetsinvolved. Johnson D, Squibb; BMS,Bristol-Myers Ab, discovery; antibody; phase;PR, pre-registration; R,registration. disclosedfinancials.A total of57theM&Adealsin thetimeperiod Onlydealsfor therapeuticswere considered. See Table 2|Oncology M&Adealsvalued at more than$1billionbetween 2013and2017 *PhaseTDO, 2,3-dioxygenase. appliesto thedevelopment assetatthetimeofdealsigning. tryptophan gene3protein; J&J, activation LAG3, PD1,programmed &Johnson; Johnson lymphocyte celldeathproteinIDO, 1;PDL1,PD1 ligand1; I-O, immuno-oncology; indoleamine2,3-dioxygenase; See Table 1(cont.) |Oncology licensing, joint venture andresearch-only dealsvalued at more than$1billionfrom 2013to 2017 Flexus Biosciences Aragon Pharmaceuticals Ganymed Pharmaceuticals Celator Ignyta Pharmaceuticals Seragon IFM Therapeutics Engmab ARIAD Onyx Stemcentrx Pharma Kite Medivation Pharmacyclics side Sell Pfizer Servier Roche Amgen Merck KGaA Gilead Amgen Servier (Genentech) Roche Roche Novartis Celgene Therapeutics Arrys GSK Licensee The ranking of the top oncology dealmakers by dealvolume ofthetop oncologydealmakers The ranking Box 1 Box for details of the data. BMS, Bristol-Myers Squibb; CAR, chimeric antigen receptor; GITR, glucocorticoid-induced GITR,glucocorticoid-induced antigenreceptor; for CAR,chimeric Squibb; TNF-related detailsofthedata.BMS, Bristol-Myers HDAC, GlaxoSmithKline; protein; histone GSK, deacetylase; Fig. 3 ), withamediantotal dealsof valuefor discovery BioAlta Sorrento Medicines Blueprint Biotechnologies Immatics F-Star Alpha MacroGenics Pharma Kite Cellectis Genetics NewLink Partners Molecular Cerulean Pharma Sutro Biopharma AskAt Adaptimmune Licensor BMS J&J Astellas Pharmaceuticals Jazz Roche (Genentech) Roche BMS Celgene Takeda Amgen AbbVie Gilead Pfizer AbbVie Buy side

02/2015 06/2013 10/2016 05/2016 12/2017 07/2014 08/2017 09/2016 01/2017 06/2013 04/2016 08/2017 08/2016 03/2015 Date 2015 2016 2016 2017 2017 2013 2014 2014 2014 2013 2016 2014 2017 2014 Year conjugates Conditionally Active Biologic (CAB) antibody–drug Anti-PD1 antibody Small moleculesagainstimmunokinases bispecificimmunotherapies T cell-engaging Bispecific antibodies, incl. anti-PDL1antibody Re-Targeting Dual-Affinity products (DART) platform (eACT) CAR T celltherapiesusingautologous celltherapy T celltherapeutics, incl. UCART-19 TDO/IDO inhibitors DARPin–drug conjugates Targeting technology conjugates usingDynamic Tumor Nanoparticle–drug conjugates Antibody–drug Prostaglandin EP4receptor antagonists T celltherapy targeting theNY-ESO antigen Technology/mechanism ofaction ✓ ✓ D Stage P1 ✓ Amgen have alsoexecuted anumberofout-licensing dealsaround Merck &Co., Squibb, Bristol-Myers &Johnson, EliLillyand Johnson back into R&Dandmeetthecompany’s target. return-to-growth sell orshare to itsmoleculesto rights generate incometo invest indicative ofthecompany’s publiclystatedinstitutions, strategy to is AstraZeneca, justbelow themajoroncologyresearch ranked ( prominently inthesell-sidecategory ✓ ✓ ✓ ✓ ✓ P2 P3 ✓ PR/R ✓ ✓ ✓ ✓ L Box 1 for details. Ticks indicate thelatest stageof $1,250 $1,350 $1,398 $1,500 $1,700 $1,725 $2,320 $3,100 $5,200 $9,700 $10,426 $11,900 $14,300 $20,800 ($ millions) Financials Fig. 4 Discovery Discovery Discovery Discovery Discovery Phase 2 Discovery Phase 1 Discovery Discovery Discovery Phase 2 Phase 2 lead asset Phase of Discovery ). The mostnotableexample biopharmadealmakers.nature.com |March 2018 | Small molecule Small molecule Ab Chimeric Small molecule Small molecule Small molecule Small molecule Ab Multivalent Small molecule Small molecule Conjugated Ab Cell therapy Small molecule Small molecule technology Asset/ ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓ I-O ✓ 1,000 1,010 1,030 1,067 1,085 1,110 1,120 1,150 1,160 1,173 1,185 1,200 1,253 ($ millions) Total 1,000

28 45 30 66 30 60 10 50 60 5 Undisclosed Undisclosed 42 ($ millions) Upfront Undisclosed

B5 B5

feature feature B6 Fig. 4| The top 20oncology licensors andlicensees from 2013to 2017. ofthedeals.constituted onlyasmallfraction thewest between andeast licensees).Activity with Europe-based direction (10%for thosewithUS-basedlicenseesand~9%for those the total activity, followed ineither by transatlanticpartnerships within Europeactivities are adistantsecond, constituting13% of US-basedorganizations. between deal­ ties occurring Internal dominated by the US, with approximately activi 40% of dealmaking regions, of the is overallwithin particular proportion activity again companies are involved in more than half (56%). A substantial later phase. options thatwillallow companiesto regain to theassetata rights fordeprioritized investment. internal Suchdealsmay includereturn assets that these companies haveearly-stage presumably currently See thus anaverage ofthedealsexcluding thisdealisalsoshown. onthevalueofdealsforimpact launchedproducts, and AstraZenecadeal between andMerck &Co. hashadasubstantial deals by phaseat signing from 2013to 2017. Fig. 3|Licensing, joint venture andresearch-only oncology Memorial Sloan-Kettering Cancer Center Sloan-Kettering Memorial With respect to the geographical location of the deals, US-based

|March 2018 | Number of deals 100 200 300 400 500 600 700 800 Box 1 Box 0 Cancer Research Technology Ltd Discovery for detailsofthedata. MD AndersonCancer Center Dana-Farber Cancer Institute H Lee Cancer Center Moffitt Upfront median Average total value Total numberofdealswithstage National Cancer Institute Syndax Pharmaceuticals biopharmadealmakers.nature.com Hanmi Pharmaceuticals Phase 1 Bristol-Myers Squibb Bristol-Myers Cancer Research UK Johnson &Johnson Johnson AstraZeneca–Merck deal Average total valuewithout AstraZeneca–Merck deal Upfront average without Array BioPharmaArray Phase 2 AstraZeneca Merck &Co. Transgene Advaxis Amgen Evotec Eli Lilly Phase 3 Eisai Pre-registration/ Upfront average total value Median

Top 20licensors registration 6

7 7 7 7 7 Launched The $8.5billion 8 8 9 9 9 10 11 11 11 11 13 15 17 making making

0 100 200 300 400 500 600 700 800 900 1,000

- millions) ($ value Deal ing to be the principal driver.ing to betheprincipal The licensinglandscapeisdominated therapeuticscontinu in2017,withimmuno-oncology dealmaking Services atClarivateServices Analytics. Jamie Munro andHelenDowden work inLifeScience Professional for morepotential, cross-regional andtheopportunity partnering. assets in order to generate additional revenue and fully explore their of somelarge companiesto out-license pharmaceutical pipeline includetheapparent willingness help sustainahighlevel ofactivity CAR T cellcompany Juno Therapeutics. Additional thatcould factors the largest dealsof2018sofarisCelgene’s $9billionacquisitionofthe conjugates andbispecificantibodies. oneof Indeed, antibody–drug technologies suchasCAR next-generation support T celltherapies, on thebackofUStaxreforms emerges andasclinicalevidence to However, we anticipate another strong year in for 2018, dealmaking followed approvals the first checkpoint-inhibitor has plateaued. that ofdealmaking thattheflurry andthepossibility cial uncertainty isdifficultto predictthefuture,valuations. It owing to globalfinan deals, large upside whichusuallyhave discovery by very early-stage 34 In conclusion, oncology remainedIn the most competitive area for See See and licensingjointventures (1,385deals). datasets were asfollows: mergers andacquisitions(94deals), “terminated” acquisitiondealswere alsoexcluded. The final agreements andsoftware. All service “pending” dealsand medicalandotherdevices,manufacturing, radiolabeling, genomics technologies, imaging, instruments, labreagents, diagnostic methods, drugformulation, drugscreening, generics, following were excluded: assays, bioinformatics, biomarkers, focus wasany ofthe inwhichtheprimary Deals categorization. therapeutic-focused dealsusingthe “technologies” for analysis. “comarketing,” “copromotion” and “collaboration” were selected and the “license” of subtypes license,”“basic “codevelopment,” mergers,stake), reverse mergers, jointventures, research-only The deal type”“transaction ofacquisitions(100%ormajority databasefrom from Analytics. Clarivate theCortellis extracted 2017were 2013and31December 1January between date withadealstart All oncologybusinesstransactions deals analysis Box 1|Data andmethodologyfor oncology The resulting datasetswere filtered to exclude non- Box 1 Box National Cancer Institute Boehringer Ingelheim Boehringer for details ofthedata. Bristol-Myers Squibb Bristol-Myers Johnson &Johnson Johnson Juno Therapeutics Daiichi Sankyo AstraZeneca Merck KGaA Kite Pharma Kite Merck &Co. Celgene Novartis Amgen AbbVie Takeda Servier Eli Lilly Roche Sanofi Pfizer Top 20licensees 9 9 9 10 10 11 11 12 12 12 13 14 15 17

19 26 - - 31 35 39 46