The pharmaceutical giant Pfizer has closed on Monday an agreement worth about 43,000 million dollars (about 40,160 million euros) with the biotechnological company Seagen to expand its portfolio of cancer treatments. The need to expand the market after the sharp drop in sales of its products against covid-19, as well as the loss of exclusivity of some of its best-selling drugs, such as viagra, is behind the merger, which “reinforces the position of Pfizer as a leading company in oncology”, as announced by the firm through a statement. The sales records of the anticovid vaccine and Paxloviv, the oral treatment for those infected with covid, made the multinational earn almost 32,000 million dollars last year.
Pfizer will pay $229 cash per Seagen share, an increase of 32.7% over Friday’s closing price. The offer also supposes a premium of almost 42% at the closing of the shares on February 24, a day before the daily The Wall Street Journal overtake the possible deal. Seagen’s shares rose to $207 on Monday in premarket trading.
Pfizer has chosen this route to mitigate the impact of a foreseeable drop of 17,000 million dollars in revenue by 2030, due to the expiration of the patents of its main drugs and the drastic reduction in demand for its two products against the coronavirus. The drugmaker expects more than $10 billion in “risk-adjusted” sales from Seagen through 2030.
It is not the first draft operation promoted by Pzifer, directed by the Greek Albert Bourla. After various mergers carried out with Pharmacia and Upjohn and Parke Davis, the American company has become the world’s leading laboratory in the pharmaceutical sector. Washington-based Seagen is a pioneer in drug immunoconjugates (ADCs), which work as guided missiles designed for a destructive effect that allows at the same time to preserve healthy cells.
Pfizer’s portfolio of cancer therapies includes 24 approved medicines, including the Ibrance breast cancer treatment. The deal, Pzifer’s largest since its $67 billion acquisition of Wyeth in 2009, will allow the multinational to incorporate four Seagen cancer therapies whose combined sales amounted to nearly $2 billion by 2022.
“Pfizer is deploying its financial resources to advance the battle against cancer, one of the leading causes of death worldwide with a significant impact on public health,” Bourla explains in the statement. “Together, Pfizer and Seagen aim to accelerate the next generation of cancer breakthroughs and bring new solutions to patients by combining the power of Seagen’s immunoconjugate (ADC) technology with the scale and strength of Pfizer’s capabilities and expertise. . Oncology continues to be the largest growth driver in global medicine, and this acquisition will enhance Pfizer’s position and significantly contribute to the achievement of its short- and long-term financial goals.”
The companies expect to close the deal in late 2023 or early 2024. Although the Joe Biden Administration closely monitors antitrust compliance, the Pzifer-Seagen merger is unlikely to face any issues in this regard, as the companies companies do not have major products that overlap. However, it could be subject to some scrutiny due to the high amount of the operation by the Federal Trade Commission (FTC), led by Lina Khan, a specialist in competition and the scourge of monopolies.
In fact, Merck, a rival of Pzifer, and Seagen held talks last year, but the rapprochement attempt failed for fear of harsh antitrust scrutiny.
Follow all the information of Economy and Business in Facebook and Twitteror in our weekly newsletter
Five Days agenda
The most important economic appointments of the day, with the keys and the context to understand their scope.
RECEIVE IT IN YOUR MAIL
#pharmaceutical #Pfizer #invests #million #dollars #battle #cancer #Economy
