Selling a Pharmaceuticals & Biotech Business

Value usually tracks what a buyer can defend in diligence. Clean IP ownership, transferable data rights, a credible regulatory path, and a resilient CMO and supplier setup often matter as much as current revenue. Services businesses with steady contracts may still price off EBITDA or SDE, while product and platform companies often price off stage and the next proof point, sometimes with milestones. Use Rejigg’s free valuation calculator for a starting range, then adjust for concentration risk, validation workload, and single-source supply exposure.

Most processes land in the 4–9 month range, but timing depends on how clean your IP, data rights, and quality documentation are. LOI-to-close can be 30–90 days when consents are minimal, and the QMS and supply story are well documented. It can run longer when you need third-party consents for university licenses, collaboration agreements, CRO MSAs, or manufacturing registrations. Rejigg keeps buyer outreach, NDA gating, and diligence documents in one place. See the timeline in prepare to sell your business.

It depends on your deal size, how specialized the buyer universe is, and how comfortable you are running a controlled diligence process. Brokers often charge 5–10% and earn their keep by managing outreach and keeping momentum through diligence. If you can handle the process directly, Rejigg gives you buyer discovery, digital NDAs, a secure data room, and side-by-side offer tracking without a success fee. Start at Rejigg and use the Owner’s Guide to keep the process tight.

Sometimes, usually for cash-flowing service businesses with stable earnings and contracts that transfer cleanly. Examples can include certain lab services, quality and compliance services, and niche distribution with predictable margins. Pre-revenue R&D programs, assets that hinge on a clinical readout, or businesses with heavy regulatory uncertainty rarely fit SBA underwriting. Rejigg includes an SBA loan calculator so you can estimate what price a buyer’s cash flow can support and filter for financeable offers.

Asset sales are common when the buyer wants specific IP, data, contracts, or equipment without inheriting unknown entity-level liabilities. Stock sales can be simpler when key permits, registrations, or contracts are hard to assign, or when regulatory continuity and corporate history matter. Structure often comes down to assignability of CRO and CMO contracts, university license terms, tax goals, and known liabilities. Rejigg’s deal tracking helps you compare offers by structure, escrow, and holdback, not only headline price. See negotiate a deal.

Working capital is the net of short-term items needed to run the business at close, such as inventory, receivables, payables, and accrued expenses. In pharma, it gets more technical because inventory is lot-controlled and can carry expiry risk, quarantine status, and cold-chain requirements. Distribution businesses also deal with returns, chargebacks, rebates, and longer receivable cycles with wholesalers or payers. Buyers typically set a working capital target with a post-close true-up. Rejigg’s data room helps you share inventory and AR/AP support during due diligence and closing.

Yes, especially when value hinges on future proof points like trial readouts, regulatory milestones, tech transfer completion, or a handful of customer expansions. They also show up when buyers see concentration risk that could unwind quickly. Earnouts work best when milestones are operationally measurable, data sources are defined, and buyer control is limited so priorities cannot quietly shift. Rejigg’s offer comparison dashboard helps you review earnout terms side by side, including timing, caps, definitions, and reporting. See negotiate a deal.

Start with what buyers usually verify first. That includes financial statements, IP assignments and key license agreements, a regulatory status summary, a study register with ownership and transfer rights, a QMS overview (deviations, CAPA, change control, training), and key CMO and supplier agreements. You do not need to publish everything up front, but you should be able to produce it quickly under NDA. Rejigg’s secure data room supports staged disclosure and buyer NDAs. Use the checklist in prepare to sell your business.

For commercial products, buyers test whether demand holds up under payer behavior. Expect questions on formulary placement, prior authorization friction, gross-to-net, rebate exposure, and what happens as competitors change labels or pricing. They often want to see evidence that utilization tracks clinical value and guideline adoption, not only early-adopter demand. Bring a channel and reimbursement summary, plus any real-world persistence and discontinuation signals you track. In Rejigg, you can keep payer decks permissioned while still showing buyers the materials exist via the data room index.

Confidentiality matters more here because diligence can expose patent strategy, clinical datasets, quality findings, and CMO and supplier details. Most sellers use staged disclosure: teaser first, then NDA, then limited diligence, and deeper release after serious intent. Rejigg supports this workflow with pre-vetted buyers, digital NDAs before access, and folder-level permissions in the data room. That reduces the chance that sensitive documents get forwarded outside your control. Learn more in find your dream buyer.

Consent requirements can slow or reshape a deal, especially for university licenses, collaboration agreements, CRO MSAs, CMO quality agreements, and key distribution relationships. Buyers will ask whether the counterparty has veto rights, whether economics change, and whether there is a termination right tied to change of control. Identify these agreements early, and build a consent plan into your timeline and closing conditions. Rejigg’s data room and deal tracker help you flag consent items and keep a clean log through due diligence and closing.

Tax outcomes depend on structure, where IP sits, and how the purchase price gets allocated. Asset sales can create ordinary income for certain items, while stock sales often lean toward capital gains treatment, but it varies by situation. For IP-heavy businesses, allocation across intangibles, goodwill, inventory, and services can change after-tax proceeds materially. Cross-border licensing and IP holding companies add complexity quickly. Model taxes early with an M&A tax advisor before locking structure in an LOI. Rejigg’s offer comparison view helps you track price, structure, and timing together.

An escrow or holdback sets aside part of the purchase price to cover indemnity claims after closing. In pharma and biotech, buyers often focus on risks that surface later, such as IP ownership gaps, data integrity problems, regulatory exposure, or QMS remediation that shows up during an audit or inspection. Strong documentation and a tight disclosure schedule can reduce both the size and length of the escrow. Rejigg keeps disclosures and supporting evidence organized so you can negotiate from a position of proof. See negotiate a deal.

Buyers look for lot traceability, expiry exposure, storage conditions, and whether reserves reflect returns, chargebacks, and obsolescence. Cold-chain handling and temperature excursion history can change whether inventory is usable and whether it creates a compliance issue. Expect requests for lot-level reports, quarantine and hold procedures, deviation records tied to excursions, and destruction logs. You also need a plain explanation of what is sellable, what is at risk, and how you prevent repeats. Rejigg’s data room is a practical place to share controlled inventory schedules and SOPs during due diligence and closing.

Compare offers on risk-adjusted value and how much you can control. Look at upfront cash, escrow or holdback, milestone definitions, buyer discretion, reporting rights, employment or consulting requirements, and closing conditions tied to consents or remediation. In pharma and biotech, the cleanest path through quality, regulatory, and supply transfer often wins even if headline price is lower. Rejigg’s deal tracking and offer comparison dashboard support side-by-side review so hidden risk does not get missed. See negotiate a deal.

Transitions often run longer in regulated pharma and biotech because the buyer may need support for tech transfer, validation work, QMS harmonization, partner handoffs, and regulatory notifications. Many deals land on 3–12 months of consulting, plus targeted retention for QA, validation, and process owners. Define scope tightly, including what you will do, what “done” looks like, and when responsibility fully transfers. Rejigg’s process guidance helps you plan this early in transitioning after the sale.

Buyers usually separate your value-added margin from pass-through costs like materials, cold-chain, third-party testing, and freight. They will also check how quickly pricing resets when costs move, since delays can crush margin in a long trial or supply cycle. Prepare clean P&Ls showing gross margin drivers, contract language around pass-through, and any lag between cost increases and customer repricing. Document add-backs, and keep them easy to prove. Rejigg can import financials via QuickBooks to populate the data room faster. Start with prepare to sell your business.

Beyond price, focus on exclusivity length, diligence scope and timeline, structure, required consents, escrow and indemnity caps and survival periods, earnout mechanics, and any employment or consulting obligations tied to key people. In regulated businesses, pay close attention to closing conditions tied to quality findings, open CAPAs, inspection outcomes, or supply transfer readiness. Those can become open-ended if they are not defined. Rejigg’s offer tracking keeps key terms visible across buyers so a “high price” LOI does not hide deal-breaking conditions. See negotiate a deal.

Start now with items that tend to create late surprises. Clean up IP chain of title, build a rights and consents map, create a study and data-rights register, and write a buyer-ready QMS summary that includes audit history and CAPA evidence. These take time because you may need signatures, amendments, and third-party responses from universities, CROs, CMOs, or suppliers. Then tighten financial reporting with consistent add-backs and clear pass-through treatment. Rejigg’s guided steps and data room help you build diligence readiness through prepare to sell your business.