Pfizer will pay US$81.50 a share in cash, the companies said in a statement yesterday. It is expected to close in the third or fourth quarter of this year.
Advertisement
The announcement of the deal was made on Sunday. Pfizer’s shares fell $0.14 in the wake of the deal, closing at $34.84. The closing of the tender offer is subject to customary closing conditions, including USA antitrust clearance. Pfizer expects to achieve high long term growth from its oncology pipeline, and by adding Medivation, PFE hopes to boost this portfolio of drugs which treats tumors.
This acquisition, would further the efforts of Ian Read the Pfizer CEO, to bolster the innovative side of the business. The biotech also has an immune-oncology asset in development for diffuse large B-cell lymphoma and other hematological cancers.
Medivation has the rights to Xtandi in the USA, with Japanese firm Astellas having ownership elsewhere.
Since its approval for advanced metastatic prostate cancer by the U.S. Food and Drug Administration in 2012, XTANDI has treated 64,000 men to date in the U.S. alone. It already generates about $2 billion in yearly sales and has the potential to more than double, according to analysts. According to EvaluatePharma, Xtandi could be one of the top-selling cancer drugs by 2020. Talazoparib, now in a Phase III study for the treatment of BRCA-mutated breast cancer, has the potential to be a highly potent poly ADP ribose polymerase (PARP) inhibitor. The market is very lucrative for drug makers. In July, Sanofi disclosed that it had offered in late June to raise its offer to $58.00 in cash and $3.00 in the form of a contingent value right relating to Medivation’s breast cancer treatment Talazoparib’s sales performance. The company rejected the bid, saying that it undervalued the business substantially.
There has been a push from Wall Street for the drugmaker to break itself up into smaller companies so that it can grow faster.
Advertisement
In one of the longest running bidding wars in recent times, Pfizer Inc. Reports also said that it represents a 118-percent rise since March when Medivation had hired JP Morgan to handle interest from several companies in a potential acquisition.
