Unless something changes, the next decade looks grim for big pharma.

Research and development productivity has slipped and most top-selling products will come off patent. Cost-cutting can only do so much to preserve profits. What the drug manufacturers really need are new products to patch the potholes in their revenue flows. One way to do so is to buy smaller firms that have drugs that are already approved or in the late stages of development. Some companies have already begun their shopping sprees – there were 995 deals in the pharma/healthcare sector in the  first half of 2007 worth $140bn, according to PwC.