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Job posting data foreshadows big pharma deals

2 months ago by Jon Marino in Facts, Trends

Big pharma is getting bigger; as pharmaceutical and healthcare companies look to blend industry lines and create hybrid delivery models, they're buying competitors and compliment-ors to preserve longevity.

We've already shown when M&A deals are foreshadowed based on job postings, and the pharmaceutical and healthcare industries are no different.

CVS-Aetna

One of the largest deals in the history of M&A was tipped in the job postings; Aetna ($NYSE:AET) was reducing postings on its way to a $77 billion merger with CVS Health ($NYSE:CVS). The deal was announced in early December 2017, after Aetna had cut 47% of job postings. 

Bristol Myers Squibb-Celgene

New York pharma company Bristol Myers Squibb ($NYSE:BMS) announced earlier this year, and completed in April, a deal to buy Celgene ($NASDAQ:CELG), a New Jersey-based biotech firm. This was a deal where the bidder tipped its hand. Jobs listed online show Bristol Myers Squibb reduced postings more than 25% from its 2018 peak to the deal announcement date, and by 50% by the time it had closed.

Takeda-Shire

The $62 billion deal through which Tokyo-based pharmaceutical giant Takdea ($TYO:4502) acquired biotech firm Shire ($NASDAQ:SHPG)  was announced in May 2018,  but was preceded with a 30% in job postings by the target the day before the deal was announced.  By January 2019, when the deal's completion was announced, job postings for Takeda's target were reduced by nearly 40% from their 2018 peak.

There are a number of other pharma players that have recently cut job postings substantially, which could be a sign of pending M&A. 

However, just because a company with a market capitalization north of $30 billion starts cutting job opening isn't necessarily a sign of pending M&A. Conversely, just because one of the little guys in the pharma/biotech business — and, by little, we're meaning "under $20B market cap" — does something similar, it's also no sign of a guaranteed deal. Sometimes, companies could be aligning to launch a new product, consider a pivot, or they're just shutting down something that's bound to flunk out of regulatory trials. 

As we researched this story, we came across a number of big pharma players that also recently made big cuts to job postings, and we'll follow up if that foreshadowed a major transaction. 

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Jon Marino

Jon Marino is Thinknum's finance editor, covering the impacts of alternative data on public companies and investors. Prior to joining Thinknum, Jon worked in the ...

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