“It clearly is a year of mergers for pharmaceutical companies,” Philippe Lanone, an analyst at Natixis Securities in Paris, told Bloomberg News in a telephone interview. “They don’t have much of a choice if they are to guarantee EPS growth in the years to come.”

The pharmaceutical industry is consolidating now that many of the blockbuster drugs of the 1990s are losing patent protection, negatively affecting sales. And the situation has been made worse by a lack of replacements in the research and development pipeline at big drug companies.

Other big drugmakers, including Bristol-Myers Squibb Co. (BMY), may be forced to merge with rivals to diversify product lines and combine R&D as their biggest-selling products lose patent protection and come under fire from generic competition.

Many biotech companies, including Merck and Schering-Plough, have eliminated thousands of jobs and restructured operations to further cut costs. But most of those moves appear to have run their course.

“Basically these mega mergers are going to come back because the revenue in the pharma sector have no chance of growing and cost cutting can’t go much further for many companies,” Navid Malik, an analyst at London-based Matrix Corporate Capital LLP, told Bloomberg. “Any company that misses out on this round of mega mergers runs the risk of losing market share.”