The Globe and Mail

Go to the Globe and Mail homepage

Jump to main navigationJump to main content

Valeant Pharmaceuticals International Inc. CEO Michael Pearson is seen in one of the company's laboratories Tuesday, April 3, 2012 in Laval.
Valeant Pharmaceuticals International Inc. CEO Michael Pearson is seen in one of the company's laboratories Tuesday, April 3, 2012 in Laval.
(Ryan Remiorz/CP)

Pharma’s new math: Less R&D, more M&A

Once upon a time, the way to be a big pharmaceutical company was to discover and develop drugs. But now, the business is becoming less about R&D, and more about M&A. It may cause excitement in financial markets, but it’s not a sign of health.

Valeant Pharmaceuticals International Inc.’s nosebleed-inducing $46-billion (U.S.) hostile takeover bid (in partnership with Bill Ackman) for Botox maker Allergan Inc. is the latest, and boldest, move yet from a company that has become the pharma industry’s poster child for buying your way to the top. In the past two years, Valeant has spent nearly $13-billion (U.S.) on acqusitions.