Life sciences dealmaking volume is stable, but value is down. The 2025 edition of the EY Firepower report explores how life sciences companies can secure a more confident future with smarter, smaller deals.

Key takeaways from the EY 2025 Firepower analysis:

• 2024: A reset year? Deal value fell in 2024, as life sciences companies turned away from the major M&A plays of 2023 to focus on bolt-ons and other smaller strategic plays.
• Deal or no deal? Drivers and restraints in 2025. The industry still faces significant growth gaps, has significant M&A Firepower and is expecting policy tailwinds from the incoming US administration; however, high costs and a lack of prime targets may hold dealmakers back.
• 2025 — Year in prospect: While major deals could come back on the agenda, the past 12 months have shown the industry is also widening its search for value, looking earlier in the product cycle, increasing strategic focus on the AI opportunity and tapping new opportunities including the new wave of innovation from China’s emergent biotech ecosystem.
• Why deals should be at the center of life sciences strategy. EY analysis shows that dealmaking is critical to growth in the life sciences sector, with the majority of leading company revenues coming from products derived from dealmaking; companies need to partner successfully to shape their future with confidence.

Read the full report here.