Pfizer buys cancer drugmaker Medivation for $14 billion, will add XTANDI to drug lineup
XTANDI has been used to treat 64,000 men with prostate cancer to date and has generated $2.2 billion in sales.
Pfizer's headquarters (Wikimedia Commons image)
Pfizer on Monday said it will acquire Medivation for $14 billion in a move the pharmaceutical giant said will bolster its position as a leader in cancer medication.
The company will pay $81.50 per share for Medivation, using existing cash on hand to finance the deal. It is expected to close in the third or fourth quarter of this year.
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"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." CEO Ian Read said in a statement. "This transaction is another example of how we are effectively deploying our capital to generate attractive returns and create shareholder value."
Medivation owns cancer drug XTANDI, a hormone therapy that targets cancer tumor cells. It has been used to treat 64,000 men with prostate cancer to date and has generated $2.2 billion in sales.
According to recently-released Medicare Part D spending data, the federal government spent $447 million on XTANDI claims in 2014.
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Medivation also has two cancer drugs in late-stage trials. Talazoparib is being tested for treating BRCA-mutated breast cancer, while Pidilizumab, an immuno-oncology drug, is being tested for treating large B-cell lymphoma. According to Pfizer, Pidilizumab has the potential to be combined with other immuno-oncology drugs owned by Pfizer.
"We believe that Pfizer is the ideal partner to extend the reach of our blockbuster XTANDI franchise and take our promising, late-stage assets – talazoparib and pidiluzimab – to their next stages of development so that they can be made available to patients as quickly as possible," Medivation CEO David Hung said in a statement.
News of the acquisition pushed Medivation's stock price up nearly 20 percent on Monday morning, with shares trading around $80 a share, close to the pfizer offer price. The stock had closed on Friday at $67.16 a share.
Pfizer said it expects the deal will add about 5 cents per share to its value for the first full year after the deal closes.
Twitter: @HenryPowderly
Contact the author: henry.powderly@himssmedia.com
