MDVN announced that they have entered into a definitive merger agreement under which Pfizer will acquire Medivation for $81.50 per share in cash or a total enterprise value of about $14 billion.
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Medivation shares jumped almost 20 percent to close at $80.42, just shy of the offer price of $81.50 per share. The purchase will help make Pfizer a stronger presence in the lucrative cancer drug business, with the possibility of expanding Xtandi to breast cancer treatment. AstellasPharma Inc. also sells Xtandi that would become one of the top-selling cancer drugs by 2020.
The purchase of Medivation, if approved by regulators, would be Pfizer’s biggest buy since it bought the medical device company Hospira a year ago for $17 billion, a report by AFP stated.
A man walks past Pfizer’s world headquarters in NY on April 28, 2014.
“The combination with Pfizer is the right next step in our growth trajectory”, said David Hung, chief executive of Medivation. “We believe that Pfizer is the ideal partner to extend the reach of our blockbuster Xtandi franchise”.
It also produces the promising new talazoparib breast cancer drug, now in a phase three study. And its big appeal comes from an experimental breast-cancer treatment called talazoparib. And company shares have begun to climb after years in the doldrums.
The deal is a blow to Sanofi’s cancer ambitions. However, Medivation rebuffed all of Sanofi’s efforts as undervaluing the company and began taking bids from other potential suitors.
Pfizer will pay about $14 billion to buy cancer drug developer Medivation in a cash deal aimed at fortifying its hold in one of the hottest and most lucrative areas of medicine.
Pfizer CEO Ian Read called the acquisition a “rare opportunity” to add an established treatment and a pipeline of drugs under development.
Thanks to the merger, Pfizer now has advanced prostate cancer treatment Xtandi (enzalutamide) in its kitty. The company is also trying to catch up with Merck & Co MRK.N and Bristol-Myers Squibb Co BMY.N in developing immuno-oncology drugs that work by taking the brakes off the immune system to fight cancers. “IBRANCE and XTANDI are anchor brands in breast and prostate cancer respectively, giving Pfizer leadership in two hormone-driven cancers”.
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There is more to Medivation than XTANDI though.
