The Most Common Cognitive Biases In Life Sciences M&A
These common examples of narrow thinking can prevent decision-makers from coming up with more than one solution to a particular problem.
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Life sciences mergers and acquisitions are typically based on perceived future value rather than objective financial parameters, but the cognitive biases inherent in subjective assessments can derail deals. Executives need to take emotion out of the equation and rely on relevant data to craft successful transactions.
The biopharma market has been highly active throughout the COVID-19 pandemic with a substantial focus on strategic alliances between 2020-H1 2021. Partnership deals present exciting liquidity and risk mitigation opportunities for early-stage companies. Small molecules still comprise the largest segment of partnered drugs, but alliances for other modalities are on the rise.
Outcome Capital analyzed transactional activity by the largest biopharmaceutical companies in the three-and-a-half-year period between January 2017 and June 2020 to reveal development and therapeutic areas trends.