Cash-rich Pfizer to pay $11.6 billion for Biohaven in biggest deal since 2016
Vlad Coric is the CEO of Biohaven Pharma
PfizerWill pay $11.6 Billion to Buy Migraine Pill Maker Biohaven PharmaceuticalThis is the largest deal the cash-rich pharmaceutical company has made since 2016, to expand its product portfolio in advance of some patent losses.
Pfizer will have access to Biohaven’s approved rimepant. This deal was announced Tuesday. It is part of a group known as calcitonin-related peptide inhibitors (CGRP).
Pfizer, which has $32 billion of cash left after the Covid-19 success story, is looking for new treatments to patent its best-selling drug Eliquis.
Also, sales of Covid-19 vaccines will drop from the highs reached last year.
Investors will love this deal. This deal is attractive because of Pfizer’s solid balance sheet. We would expect more deals like this,” Mohit Bansal, a Wells Fargo analyst, stated in a note.
Biohaven’s deal with Biohaven is larger than Pfizer’s 2014 purchase of Medivation, a cancer drugmaker Medivation for $14 billion.
Pfizer will buy all Biohaven shares it doesn’t already own at $148.50 each share in cash. This is a 78.6% discount to the closing price. Pfizer had previously taken 2.6% of Biohaven’s shares in November.
Biohaven’s shares rose 70.1%, to $141.39 just before the bell. Pfizer traded flat at $48.60.
Pfizer’s deal with Eli Lilly allows it to compete on the migraine market against other big drugmakers like Eli Lilly.
Biohaven’s rimegepant is sold in the United States as NurtecODT. This medication is approved as an effective treatment and prevention for migraines. The drug is predicted to generate sales in excess of $4 billion in 2030. The 2021 sales were $462.5 millions.
Biohaven has also been developing a CGRP inhibitor and in the late stages of testing non-CGRP medications.
Biohaven shareholders including Pfizer will receive 0.5 shares of a new publicly listed company after the transaction closes. This will allow them to keep Biohaven’s non CGRP treatments.