Flush with cash, Pfizer buys Global Blood Therapeutics in $5.4 bln deal

Author of the article: Reuters Mrinalika Roy and Michael Erman Pfizer Inc on Monday agreed to pay $5.4 billion in cash for sickle cell disease drugmaker Global Blood Therapeutics, as it looks to capitalize on a surge in revenue from its COVID-19 vaccine and treatment. Pfizer will pay $68.50 per GBT share, which represents a…
Flush with cash, Pfizer buys Global Blood Therapeutics in $5.4 bln deal

Author of the article:

Reuters

Mrinalika Roy and Michael Erman

Pfizer Inc on Monday agreed to pay $5.4 billion in cash for sickle cell disease drugmaker Global Blood Therapeutics, as it looks to capitalize on a surge in revenue from its COVID-19 vaccine and treatment.

Pfizer will pay $68.50 per GBT share, which represents a 7.3% premium to its Friday closing price and a nearly 43% premium over Thursday’s closing price after Bloomberg reported that GBT had attracted takeover interest. The Wall Street Journal reported on Friday that Pfizer was in advanced talks to buy it.

Pfizer’s 2021 revenue of $81.3 billion was nearly double the mark from the previous year, due to COVID-19 vaccine sales. With the addition of its COVID-19 antiviral pill Paxlovid, Pfizer is expected to generate around $100 billion in revenue this year, but sales from both products are expected to decline going forward.

Pfizer has been on the lookout for acquisitions that could bring in billions in annual sales by the end of the decade.

“We have very deliberately taken a strategy of diversification in our M&A deals,” Aamir Malik, Pfizer’s top dealmaker, said in an interview. He said the company was focused on improving growth for the second half of the decade, rather than large deals that generate value through cost cuts.

“We think that there are opportunities across all therapeutic areas that we’re active in,” Malik said, noting the company was agnostic about size for future deals.

In May, Pfizer struck an $11.6 billion deal for migraine drug maker Biohaven Pharmaceutical Holding and recently also completed a $6.7 billion deal to buy Arena Pharmaceuticals.

With the acquisition of Global Blood Therapeutics, Pfizer adds sickle cell disease treatment Oxbryta, which was approved in 2019 and is expected to top $260 million in sales this year. It will also pick up two pipeline assets – GBT601 and inclacumab – targeting the same disease.

Pfizer said if they are all approved, it believes GBT’s drugs could generate more than $3 billion in sales annually at their peak.

Sickle cell disease is an inherited blood disorder that affects an estimated 70,000 to 100,000 people in the United States.

GBT Chief Executive Officer Ted Love said Pfizer’s resources and multinational infrastructure will allow the company to launch Oxbryta in additional markets and boost its uptake.

“We really have no infrastructure outside of that (U.S. and western Europe) and it takes time and money to build out those infrastructures and Pfizer already has all of it,” Love said.

Shares of Global Blood rose 4.5% following the deal announcement. Pfizer shares closed up marginally at $49.41 apiece on Monday. (Reporting by Mrinalika Roy in Bengaluru; Editing by Shinjini Ganguli, David Evans and Lincoln Feast.)

Financial Post Top Stories

Sign up to receive the daily top stories from the Financial Post, a division of Postmedia Network Inc.

By clicking on the sign up button you consent to receive the above newsletter from Postmedia Network Inc. You may unsubscribe any time by clicking on the unsubscribe link at the bottom of our emails. Postmedia Network Inc. | 365 Bloor Street East, Toronto, Ontario, M4W 3L4 | 416-383-2300

Read More

Total
0
Shares
Leave a Reply

Your email address will not be published.

Related Posts
Proactive news headlines including Apple, Esports Entertainment, Champion Gaming, Silvercorp Metals and Fobi AI
Read More

Proactive news headlines including Apple, Esports Entertainment, Champion Gaming, Silvercorp Metals and Fobi AI

Author of the article: New York, Jan. 28, 2022 (GLOBE NEWSWIRE) — Proactive, provider of real-time news and video interviews on growth companies listed in the US and Canada, has covered the following companies: PowerTap Hydrogen Capital Corp is betting on the hydrogen revolution taking off in the next few years click here Apple reassures with…
Wheat futures ease, but Russia-Ukraine tensions limit losses
Read More

Wheat futures ease, but Russia-Ukraine tensions limit losses

Author of the article: SINGAPORE — Chicago wheat futures dipped on Friday after a strong performance in the previous session, although heightened tensions between leading grains suppliers Russia and Ukraine limited losses. The most-active wheat contract on the Chicago Board of Trade (CBOT) was down 0.4% at $8.01-1/2 a bushel, as of 0159 GMT, after…
Yen wallows as Omicron fears subside and rate hikes loom
Read More

Yen wallows as Omicron fears subside and rate hikes loom

Author of the article: SYDNEY — The yen was pinned near a five-year low on the dollar on Wednesday and nursing losses on other crosses as traders wagered the Bank of Japan would lag a looming wave of global policy tightening as inflation gallops ahead around the world. The yen tumbled through support around 115.50…
Polls open in Italy, right-wing alliance seen winning
Read More

Polls open in Italy, right-wing alliance seen winning

Author of the article: Reuters Crispian Balmer and Keith Weir ROME — Polls opened in Italy on Sunday in an election that is forecast to return the country’s most right-wing government since World War Two and also herald its first woman prime minister. Voting began at 7 a.m. (0500 GMT) and will continue until 11…