Key Takeaways
- Pfizer has won the bidding war to acquire obesity drug developer Metsera for $10 billion.
- Novo Nordisk had attempted to outbid Pfizer but faced regulatory hurdles.
- Metsera’s board recommended Pfizer’s offer due to lower legal and regulatory risks.
- The acquisition gives Pfizer a foothold in the rapidly growing weight loss market.
- Metsera’s experimental obesity drugs, MET-097i and MET-233i, are projected to reach $5 billion in combined peak sales.
Pfizer to Acquire Metsera for $10 Billion, Winning a Bidding War Against Novo Nordisk
Pfizer has announced it will acquire Metsera, an obesity drug developer, for $10 billion. The deal marks a significant win for Pfizer in its pursuit of a stronger presence in the rapidly expanding weight loss market. The acquisition comes after a period of intense competition between Pfizer and Novo Nordisk, which erupted last week when Novo Nordisk attempted to outbid Pfizer’s initial offer from September. The final agreement signals a strategic victory for Pfizer, allowing it to gain access to promising experimental obesity drugs.
The acquisition price of $86.25 per share includes $65.60 per share in cash and a contingent value right (CVR) that could provide up to an additional $20.65 per share in cash. This represents a 3.69% premium over Metsera’s closing price on Friday. While Novo Nordisk had been vying for Metsera, the company ultimately determined that Pfizer’s offer presented fewer potential legal and regulatory complications.
Novo Nordisk’s Ambitions and Regulatory Challenges
Novo Nordisk’s interest in Metsera stemmed from its desire to regain its leading position in the obesity drug market, a position it had previously held but lost to Eli Lilly. It remains uncertain if Novo Nordisk will launch another attempt to acquire Metsera, but it seems unlikely.
Metsera, in its official statement, clearly indicated that Novo Nordisk’s offer came with "unacceptably high legal and regulatory risks" when weighed against the proposed merger with Pfizer. This factor played a crucial role in Metsera’s board of directors recommending that shareholders approve Pfizer’s amended offer. Pfizer, in turn, expressed its satisfaction with reaching an agreement with Metsera.
Metsera’s Promising Obesity Drug Pipeline
Metsera’s value lies in its pipeline of experimental obesity drugs. The company is currently operating at a loss, and analysts predict continued losses during the development phase of its drugs. The two most promising candidates are MET-097i, a GLP-1 injectable, and MET-233i, which mimics the pancreatic hormone amylin. Leerink Partners analyst David Risinger projects that these drugs could reach a combined peak sales of $5 billion.
Escalating Bidding War
The bidding war between Pfizer and Novo Nordisk drove the acquisition price from Pfizer’s initial $7.3 billion offer in September to the eventual $10 billion deal. The competition escalated into a legal and strategic standoff, with Novo Nordisk attempting to challenge Pfizer’s hold on Metsera through a complex deal structure that raised concerns among regulators.
