Tyler Crowe

But aside from that, this track record of value destruction at these major brands has to be like a red flag going into these sort of deals, don't you think?

Yeah, and just for keeping score, too, the deal between Unilever and McCormick is also going to be taking on a rather considerable portion of debt as well.

Whatever happens with these, the question for the next couple of years is, how quickly can we get these debt levels back down to pay off and make these things worth their while?

We will be watching that.

Then, after the break, we're going to look at another M&A deal, but completely unrelated industry.

We're going to shift gears in the industries we're talking about.

We're going to stick with M&A.

Yesterday, Eli Lilly announced it was acquiring Centessa Pharmaceuticals.

As the case with most biotech deals, it is contingent on Centessa meeting some milestones.

Assuming Centessa hits them, the deal is worth approximately $7.8 billion.

Now,

I'm going to leave it to you, Matt, to get into the details of what it does.

Centessa is a clinical stage development company that's looking to treat narcolepsy.

Why is Eli Lilly willing to fork over $7 billion for a company that doesn't really even have a commercial treatment yet?

To that point, too, I'm not going to claim to be somebody who can read clinical trial data very well and say whether it's good or bad in the direction they're going.

But as somebody who has invested in the space from time to time, there are some hard numbers that investors should think about when looking at clinical stage pharmaceutical companies.

It's something around 20% to 30% of drug candidates that start a phase two clinical trial end up actually getting all the way through trials and FDA approval.

You want to think of it as almost like companies with lots of shots on goal in their development pipeline, because there's no far-growing conclusion that any of these, in particular, ones are going to make it through.

And as we mentioned, there are some kind of contingencies built into the deal that says, hey, you have to meet these milestones for us to actually pay out the number that we're saying.

I want to shift gears a little bit, because talking about healthcare in general, I want to get your guys' thoughts, but I don't want to drift too far here.