that is like a chicken and the egg argument…the more companies doing research (and colleges too) the better!
some pharma companies have started to use bio tech companies as sources for their pipeline. that is true. but they see that as a money saving idea. and every researcher who loses a position does not wind up founding the next amazing start up or even getting a job at one. the collective knowledge of 1000x of scientist is lost!
“some pharma companies have started to use bio tech companies as sources for their pipeline…”
This has been going on since the early days of biotech… And not just “some companies.”
What is the collective knowledge you are talking about? Like folks who generate ideas and IP? When such layoffs happen, among that 1000, only a few are truly knowledge carriers (we have one of such folks here, scout). The rest are lab support folks, lawyers, admin, etc. I am
Not saying that those people are not important, but the scientific knowledge keeps marching on. Those knowledge carriers get picked up by competitors, start their own companies, reinvent themselves. So the sad part is not some amorphous “knowledge loss”, but loss of good paying jobs. Just like in any other industry.
I am referring to science people. the people who move as forward as humans! yes lab techs and lawyers etc…are important too but I am talking about R and D for humanity not just because of a profit motive. (call me crazy)
I rue the day that Jordan Marsh was converted to Macy’s!
I still miss The Bon - yup, absorbed by Macy’s (aka Messy’s).
My point, zo, is that true scientific talent and the “collective knowledge” as a whole does not disappear. It moves on. We are still the leaders in biotech innovation. No matter what kind of bogus vaporware the Chinese and what kind of miracle cures the Russians tout at industry conventions. 
At CVS, they almost never have pharmacist overlap. It is fairly common for pharmacists to work 14 hour shifts without lunch breaks. CVS has the worst tech coverage of any of the major pharmacy chains. They are also the most hated. For the front of the store, CVS, on average, only has two people.
Each industry has a different reason for consolidation. As in:
- Supermarkets: competition from warehouse clubs, from the Aldi's/Trader Joe's at one end, from higher end markets like Whole Foods and Wegmans. You buy scale to save costs. But another factor is that European money came into the US supermarket industry: Sainsbury, Royal Ahold in particular have seen the US as a good investment, particularly given the Eurozone's lower long-term growth prospects and the Euro's weakness, which means US profits can be worth more (though there is exchange rate risk, which they hedge).
- Drugstores: competition from mail order (much of which is CVS Caremark), from Target/Walmart/warehouse clubs and from the internet, meaning Amazon and some others. US companies decided to be the sharks buying up the rest, like Walgreens buying out Boots.
- Drug companies are totally different: they buy innovation, a pipeline of potential drugs, or they buy the cash flow from the existing drug. Much of this trend is driven also by competition from abroad, as in Teva buying up lots of generic and other "low-end" drug companies. Target brought in CVS in large part - IMHO - because of Caremark and CVS' power. Their other choice would have been Walgreens!
- Hotels are, I think, driven by something even more basic: they're making money and that makes them desirable. Lots of hotels are being built - and there's huge diversification within brands - and the cash flow (current or expected) is relatively easy to hock for a loan.
There are lots of reasons, though big ones are clearly the portability of capital and the growing connectedness of organizations through the internet. These are related: you buy into markets now because experience has taught that existing companies know things you would otherwise learn over time and thing are easier (maybe) to manage or at least observe because the internet allows accounting, forecasting, etc. to be connected (and updated continuously). In a big sense, the growth in m&a reflects the development of the international supply chain. That is recent: remember, Apple bought up a huge percentage of air transport capacity to deliver the first iPhones - way back in 2007! - and now we take for granted that massive supply chain functioning across vast reaches. The internet itself did a lot but the cloud has been a quantum leap forward.
18 - Emilybee, it is Hyatt's house wine, made specifically for the chain by the Mondavi dynasty. I know that I can always count on it - at any Hyatt in the US. I guess it is called simply "Canvas":
Lergnom, pretty good top level overview of “why acquire.” Just want to add one thing about hotels: hotels come with a piece of RE, sometimes, leased for a very long term. Some RE can be very desirable, indeed. Not easy to build a new property in HI… Several desirable waterfront locations in HI have changed hands just in the past year: Fairmont Orchid, Ihilani, and some others, I think. Sometimes, buying the entire chain makes a better business move instead of getting these prime locations piecemeal.