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I am certain that many of you may have noticed that the size of the life sciences industry is shrinking at an unprecedented rate. Big pharma companies flush with cash, near- empty pipelines and impending patent cliffs have embarked on a buying spree that is likely to continue for next years (or at least until the economy shows clear signs of resuscitation). Pfizer’s impending acquisition of King Pharmaceuticals is just another transaction in a long list of M&A deals that have occurred over the past three years.                             

According to an article in today’s NY Times, roughly $42.2 billion worth of pharma deals have been transacted so far this year. That number is close to the $45.8 billion in M&A transactions announced by the same time last year (excluding Pfizer’s acquisition of Wyeth and Merck’s purchase of Schering Plough). Unfortunately, these mega-merger deals almost always result in massive layoffs in the industry.

While blockbuster mergers may not be good for pharmaceutical employees, the behind the scenes players—investment bankers, brokers, advisers and consultants—make out extremely well. For example, according to an article in Pharmaceutical Technology Europe, over a three month period in 2009 pharmaceutical company merger and acquisition activities generated $500 million in advisory fees for investment bankers. Clearly, mergers and acquisitions are in the best interest of company executives and the investment bankers not pharmaceutical employees.

There is no question that the recession and the down economy are driving much of the M&A activity in the life sciences sector. And, industry consolation is to be expected during challenging economic times. However, while M&A may be in the best interest of pharma company shareholders in the short term, I don’t think it will help to insure American competitiveness and innovation in the life sciences over the long term. 

Until next time...

Good Luck and Good Job Hunting

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According to a report released by the president’s Council of Economic Advisers the biggest gains in job growth by 2016 will be in the areas of healthcare and education services. Moreover, most of these jobs will require postsecondary education degrees mainly in the form of certificates and associates degrees. To meet this demand, the report argues for ways to improve the US education system so that American workers can more easily adapt to a more skilled-base economy.

The report also notes that manufacturing will continue its long term decline and that small growth will occur in the business and financial sectors of the US economy. Construction and transportation are likely to begin to grow once the economy improves. However, the largest demand and increases will occur in healthcare services, environmental-related occupations and in education service providers. Whereas other sectors of the economy have been battered by the recession, growth in the healthcare and educational services sectors have remained robust.

In the past, emphasis has been placed on obtaining a baccalaureate degree to garner gainful employment. While this trend will likely continue, explosive growth is expected for occupations that require only an associate’s degree or postsecondary education certificate. Growth in these types of jobs is predicted to outpace occupations that require a bachelor’s degree or higher.

The report also describes goals that must be met to improve the American postsecondary education system. These include: improving early childhood, elementary and secondary education; better school curriculums; closer collaboration between employers and educational institution to ensure that students learn the skills that they need on the job, better financial aid; and accountability for education and workforce programs that don’t work. I have long contended that both undergraduate and graduate programs in the life sciences introduce skill-based workforce development activities into their curriculums. Unfortunately, my attempts have fallen upon deaf ears. Perhaps this report will induce the administrators who can institute this type of change to take their “heads out of the sand”and take notice.

Until next time...

Good Luck and Good Learning!!!!!!

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