Thursday September 28, 2023

Pfizer buys Global Blood Therapeutics in $5.4bn deal

August 09, 2022

New York: American drugmaker Pfizer announced a deal on Monday to acquire Global Blood Therapeutics, makers of a recently approved treatment for sickle cell disease, for $5.4 billion.

The latest is in a series of acquisitions by Pfizer to combat a potential slowdown in COVID-19 products demand as cases fall. Pfizer said on Monday it will pay $68.50 per share, representing a premium of 7.3 percent to Global Blood stock's Friday closing and a 42.7 percent premium to Thursday's closing, before the Wall Street Journal reported that Pfizer was in advanced talks to acquire the company.

Pfizer has enjoyed an unprecedented rise in sales since the global rollout of its Covid-19 vaccine, developed with BioNTech. Sales have, however, started to slow since last year. But flush with cash from sales of its Covid-19 vaccine, Pfizer has been on the lookout for acquisitions that could bring in billions in annual sales by the end of the decade.

In May, Pfizer shelled out $11.6 billion for migraine drug maker Biohaven Pharmaceutical Holding and recently also completed a $6.7 billion deal to buy Arena Pharmaceuticals. With the agreement, Pfizer, one of the top makers of Covid-19 vaccines, acquires GBT´s Oxbryta to treat the potentially fatal blood disorder that primarily affects people of African, Middle Eastern or South Asian descent.

The drug was authorized for those over 12 years old in 2019 but gained federal approval in December for children aged four to 11. "The Street has wanted PFE to continue to bring in new assets to improve earnings visibility beyond the end of the decade when key assets start to lose their patent protection, and for the company to diversify its sales concentration in COVID drugs," Cantor Fitzgerald analyst Louise Chen said. Sickle Cell Disease is an inherited blood disorder that affects an estimated 70,000 to 100,000 people in the United States. The oral drug brought $55.2 million in sales for the company in the first quarter of 2022.

"We are excited to welcome GBT colleagues into Pfizer and to work together to transform the lives of patients, as we have long sought to address the needs of this underserved community," Pfizer Chairman and CEO Albert Bourla said in a statement.

Net sales for Oxbryta were approximately $195 million in 2021, and Pfizer said GBT´s suite of SCD treatments have the potential to generate more than $3 billion in worldwide sales. Sales of Oxbryta helped GBT generate first-quarter turnover of $55 million (up 41 percent), while the company registered a net loss of $81.4 million.

The San Francisco-based firm is due to publish its second-quarter numbers on Monday, but will not hold a previously scheduled call to discuss the earnings report. Pfizer´s second-quarter turnover jumped 47 percent -- to a record $27.74 billion -- boosted by sales of its Covid vaccine and pills. Its net profit soared by 78 percent, to $9.9 billion.