How Cognitive Bias Undermines Value Creation In Life Sciences M&A

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.

cognitive bias 1200

Merger and acquisition transactions play a central role in the life sciences sector and are the catalyst for growth and transformation, driving innovation from the laboratory all the way to the patient. As I discussed in my August 2016 article, "Where the Bodies Lie" (Nature Biotechnology, 34, 909–911), life sciences companies often fall victim to recurring misconceptions that lead to unnecessary failure.

These failures often hinge upon management’s misunderstanding of the fundamentals of market and transactional dynamics. In particular, cognitive biases play...

More from Growth

More from In Vivo

AI In Health Delivery: Patients Most Confident When HCPs Are In Charge

 
• By 

Annual survey of patients and professionals shows how attitudes to health system transformation are evolving and what stakeholders are demanding as acceptance of AI tools accelerates.

Medtech Innovators Court London-Based Investors At BioWales 2025

 
• By 

BioWales in London 2025 showcased the efforts healthtech innovators are making to meet investors on their own turf, illustrating changing attitudes and evolving needs.

Rising Leaders 2025: Metsera’s Whit Bernard’s Musical Path To Biotech Leadership

 
• By 

Metsera CEO Whit Bernard applies an unconventional leadership philosophy to develop next-generation obesity therapeutics, including monthly GLP-1 injections and oral peptides.