M&A activity in consumer health in 2023 sunk further behind the industry’s historic pace, reflecting tepid consumer demand amid persistent macroeconomic headwinds. Underlying this pattern, however, was the emergence of a new centre of M&A, with Asian-based acquisitions having its best year in a decade in 2023 and then doubling that rate again in the first half of 2024. Outside Asia, the leaders are focused on restructuring, though there are signs of rebounding rates over the near term as well.
This report comes in PPT.
For the third successive year, the pace of mergers and acquisitions (M&A) in consumer health softened in 2023, as the global macroeconomic headwinds of 2022 persisted for the first half of 2023, resulting in sluggish consumer purchasing across many categories, especially in comparison to the early years of the decade.
Underneath the broader trend of slowing acquisitions was a vibrant market of M&A involving Asia-based brands and companies, including the largest individual activity in 2023 (Kirin Holding’s purchase of Blackmores) and the largest announced activity for the first half of 2024 (Otemon’stakeover of Taisho Pharmaceutical, announced in January 2024).
The leading five OTC companies were all in some stage of restructuring in 2023 and early 2024, either via spinoffs (Haleon,Kenvue), upcoming divestments (Sanofi/Opella), or internal restructuring or layoffs (Bayer, Reckitt Benckiser). As a result, these companies combined for just one acquisition of note in 2023-2024, instead selling off non-core assets.
Looking forward, Euromonitor’s forecasts expect rebounding sales growth in lifestyle categories such as dietary supplements, sports and active nutrition, and herbal/traditional products, pointing the way for future M&A targets, especially around solutions to entrenched daily problems or products integrating multifunctional benefits.
Despite the relatively soft growth in 2023, the industry welcomed the acceleration of innovative new product categories such as comprehensive women’s health solutions or products formulated to consumers of GLP-1 weight loss drugs, with some smaller brands changing hands earlier on in their development with companies betting on the promise of these innovations.
It is the aggregation of OTC, Vitamins and Dietary Supplements (VDS), Sports Nutrition, and Weight Management and Wellbeing
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