We've seen some significant acquisitions unfold in the biotech industry in the past five years, and there are good reasons to believe that trend will continue. Larger drugmakers can instantly expand their pipeline, potentially acquiring highly promising assets without going through the often troublesome discovery process.

Of course, not every acquisition creates value. Corporations don't make the decision to buy out a smaller company lightly. Let's look at one potential acquisition target in the biotech sector: Bluebird Bio (NASDAQ: BLUE). Shares of this small-cap gene-editing specialist have slumped 60% in just the past 12 months -- substantially lagging both the broad market and the biotech sector.

The stock is much cheaper than it was just a few years ago. But is that enough to attract a larger company looking for a good deal?

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Source Fool.com