A major theme in health care will be the acceleration of blockbusters coming off patent protection. As fellow Fool Leo Sun pointed out, there are numerous companies losing patent protections this year. And over the next two years, big pharmas are set to lose more than $100 billion in revenues from top-selling drugs like Novartis' Sandostatin LAR and Exforge. In short, the pressure is on for big pharmas to bulk up their clinical and commercial pipelines.

So with this idea in mind, here is a look at two names currently making the rounds in the buyout rumor mill, and another that is flying under the radar.

Orphan drugmakers that may be takeover targets
BioMarin Pharmaceutical (BMRN -9.90%) has repeatedly been rumored to be a buyout candidate, especially after its drug for Morquio A was recommended for approval by an advisory committee for the U.S. Food and Drug Administration, or FDA. As I've mentioned previously, however, BioMarin appears to be currently priced out of the sweet spot for buyouts. With a market cap closing in on $10 billion and shares trading at over twenty-five times their cash value, it's hard to see a deal going through.

When looking at buyout possibilities, I personally believe companies are attractive if they have at least one approved drug, a strong pipeline, and are priced between $1 billion and $7 billion. While BioMarin meets two of these three criteria, it fails the market cap test. So BioMarin shareholders should be wary of buying into this rumor, despite the slate of deals going down for other orphan drugmakers like ViroPharma.

Jazz Pharmaceuticals (JAZZ -0.82%) is another orphan drugmaker with a bull's-eye on its back. After buying Italian-based biopharma Gentium for its rare liver disease drug Defitelio last December, the buyout rumors have heated up. Jazz is high on the buyout rumor list because it has both a strong commercial portfolio of orphan drugs and it's an Irish company.

Why is it lucky to be Irish if you're a biopharma? It's all about taxes. Ireland has one of the lowest corporate tax rates at 12.5% and offers corporations several other tax benefits for housing manufacturing facilities inside the country. So the buyout thesis for Jazz centers mostly around cost savings.

My take is that Jazz does look like an enticing buyout candidate. With earnings per share expected to increase by 25% next year and the potential cost-savings from Ireland's low tax rate, Jazz offers buyers a number of potential benefits. Even so, its market cap does fall on the high end of the spectrum at $7.4 billion, so the company won't come cheaply.

Buyers should keep in mind, however, that Jazz shares are only trading at 12 times the company's cash position. In the current frothy biotech environment, I see that as cheap. In short, Jazz looks more likely to be bought out than its peer BioMarin.

Dark horse buyout pick
Perhaps I'm the first to say it, but Seattle Genetics (SGEN) looks like a prime candidate to be bought out this year. Seattle Genetics fits the bill perfectly, according to the three criteria outlined above. The company has an approved drug in Adcetris, a strong clinical pipeline, and its market cap of $4.8 billion shouldn't hinder a deal.

That said, Seattle Genetics is currently trading at more than 13 times its cash position, and earnings per share are expected to drop markedly next year due to increasing clinical costs. The company is also years away from maturing its clinical pipeline or expanding the label for their lead antibody drug conjugate, or ADC, Adcetris.

So why does Seattle Genetics look like buyout fodder? I call this a dark horse candidate because there doesn't seem to be a clear reason for a buyout right now. What caught my attention was the whopping $16 million buy by director Felix Baker, of Hedge Fund Baker Bros. fame.

What's key to understand is that the Baker Bros. are notorious for buying biopharmas at just the right time. So with nothing else on the short-term horizon for Seattle Genetics, this buy makes me believe there is interest from companies like Roche to increase their stake in the ADC game. And acquiring Seattle Genetics would immediately give it a monopoly on this lucrative market. In sum, I think something is cooking behind the scenes at Seattle Genetics, so Foolish investors may want to keep this one on their radar.

Foolish final thoughts
I believe 2014 will be remembered as the year of the buyout in health care. With so many blockbusters coming off patent protection, something has to give. The problem is that the entire sector has skyrocketed in value, so buyers will have to factor "potential" into any tender offer. Looking at it this way, Seattle Genetics may not look like such an outlandish buyout pick.