Pfizer Buys Biohaven for $11.6 Billion
Major drugmaker Pfizer has agreed to buy US biotech Biohaven Pharmaceutical for around $11.6 billion. Founded in 2013 and based in New Haven, Connecticut, Biohaven specializes in drugs that target neurological diseases and rare disorders.
The transaction, which remains subject to completing the spinoff, along with customary closing conditions and regulatory approvals, is expected to close by early 2023. With it, Pfizer will gain two migraine drugs – rimegepant and zavegepant – and a pipeline of five-pre-clinical calcitonin gene-related peptide (CGRP) assets.
The agreement follows a collaboration between the two firms for commercializing the migraine therapies that was announced last November. At that time, Pfizer spent $350 million to buy 2.6% of Biohaven stock.
“We believe Pfizer is uniquely positioned to help the portfolio reach its full potential given our leading scale and capabilities,” said Nick Lagunowich, Pfizer’s head of internal medicine.
Both boards of directors have unanimously approved the acquisition, which will see Pfizer keep the two migraine drugs and spin off the non-CGRP development-stage pipeline compounds into a new publicly traded company. Biohaven shareholders will receive 0.5 of a share in New Biohaven for every share they already own in the biotech.
Pfizer has agreed to inject $275 million into the spinoff, which will have the right to receive certain royalties once annual net sales of rimegepant and zavegepant exceed $5.25 billion. Current Biohaven CEO Vlad Coric will head the standalone company, which will continue to operate under the Biohaven name.
Evan Seigerman, analyst at BMO Capital Markets, said the acquisition is a good fit for Pfizer and provided potential cost synergies.
The move marks Pfizer’s biggest acquisition since it paid about $14 billion in September 2016 for Medivation. Pfizer also spent $6.7 billion on Arena Pharmaceuticals in March, gaining potential therapies for treating immuno-inflammatory diseases, as well as $2.2 billion last November for clinical stage immuno-oncology company Trillium Therapeutics.
Author: Elaine Burridge, Freelance Journalist
