Consolidation as a means to build critical mass is still very much in the cards in the U.K. biotech sector. Vanguard Medica Group plc and CeNeS Pharmaceuticals plc - two companies that started life with very different strategies - last week confirmed that they are in merger discussions. Such a deal would create a £173 million ($272 million) central nervous system-focused biotech group with ambitions to be fully integrated from research through marketing.

"Size matters a great deal. Companies need to be above $500 million to be noticed," said Martyn Collett, commercial director at CeNeS (LSE:CEN; Cambridge, U.K.).