Creating a radiopharmaceutical investment strategy

Challenge

A major public/private investor in a BRIC territory needed help with an investment strategy for building a nationwide radiopharmaceutical infrastructure and capacity in its home country.

Solution

We held a two-day strategy workshop with the investor and other stakeholders, during which we set out the radiopharmaceuticals landscape, value chain and advised on investment strategy. We discussed potential business models in the radiopharmaceutical space and recommended that the ideal approach should be fully dedicated to radioactivity in healthcare.

We reviewed the nuclear medicine market, which was growing fast and forecasted to grow faster beyond 2015 as a high number of new radiolabelled molecules came onto the market, cautioning that some market segments would stabilize or even decline.

We discussed the profitability of various industry segments (i.e. equipment vs. drugs), drawing our client’s attention to the significant opportunities of increasing profitability, especially in PET businesses. We forecasted that the radiotherapeutic drugs market, so far considered a niche, was likely to substantially increase before 2020 and attract big pharma participation as new clinical data emerged showing substantial evidence of efficacy (e.g. Algeta/Bayer’s Alpharadin).

We reviewed the consolidation trends in the radiopharmaceutical industry, explaining how the main driving force for consolidation was the arrival of new tracers, and the acceptance of personalized medicine based on nuclear medicine.

As the investor was also intending to embark on an international radiopharmaceutical M&A strategy, we advised on potential targets (small and large) in the EU and USA. We also helped the investor refine its message concerning the value proposition it would bring to a corporate alliance.

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