Pfizer to acquire cancer drug maker Medivation

Pfizer is interested in continuing Medivation's research into anti-cancer drugs. Image courtesy of Pfizer.
Pfizer is interested in continuing Medivation's research into anti-cancer drugs. Image courtesy of Pfizer.

US based pharmaceuticals company Pfizer Inc. has this week announced a massive new acquisition plan.

The company has stated that it plans to buy Medivation, a fellow pharmaceuticals company, in order to strengthen its offerings in oncology.

All up, the deal will be worth approximately $14bn, with Pfizer buying Medivation at a price of $81.50 per share.

According to a press release, the company’s board has unanimously approved the purchase which will be financed with Pfizer’s preexisting cash reserves.

“The addition of Medivation will strengthen Pfizer’s Innovative Health business and accelerate its pathway to a leadership position in oncology, one of our key focus areas, which we believe will drive greater growth and scale of that business over the long-term,” said Pfizer CEO Ian Read.

Medivation is of interest to Pfizer due to the anti-cancer drugs which it markets and develops.

Currently, the company offers a number of patented treatments including the highly profitable prostate cancer treatment Xtandi and a breast cancer treatment called Ibrance.

As well, Medivation is working on an additional breast cancer treatment called Talazoparib which has already progressed to stage 3 trials.

Given that these drugs all have projected sales in the billions of dollars, they make an attractive investment for Pfizer. For its part, Medivation believes that its research into the development of these drugs will be bolstered as part of a larger company.

“We believe that Pfizer is the ideal partner to extend the reach of our blockbuster Xtandi franchise and take our promising, late-stage assets […] to their next stages of development so that they can be made available to patients as quickly as possible,” said David Hung, CEO of Medivation.

Larger Pfizer deal blocked by regulators

While very large in size, this deal is not the even the most ambitious which Pfizer has attempted this year.

Earlier, in April, the company announced plans to merge with Ireland’s Allergan, in a massive deal worth around $160bn.

This deal however was blocked by US regulators who saw it as an attempt by the company to move operations to a lower tax country.

Nonetheless, so far it does not look like Pfizer will have to overcome any significant regulatory hurdles to approve its acquisition of Medivation.