Pfizer buys rival drugmaker Arena Pharmaceuticals for $6.7 billion cash
With billions in war chest from the sales of covid vaccines, pharma giant Pfizer announced on Monday it has agreed to buy rival drugmaker Arena Pharmaceuticals Pfizer for $6.7 billion cash or $100 per share. Pfizer said it expects to finance the transaction with existing cash on hand.
The San Diego, California-based Arena is a clinical-stage company developing innovative potential therapies for the treatment of several immuno-inflammatory diseases. The company was founded in 1997 by Jack Lief and Dominic Behan. The biopharmaceutical also develops several treatments for gastroenterology, dermatology, and cardiology.
This is the latest in a series of acquisitions Pfizer has made this year to expand its treatment pipeline. Just last month, Pfizer acquired immuno-oncology company Trillium Therapeutics for about $2.22 billion to strengthen its arsenal of blood cancer therapies.
As part of the acquisition agreement, Pfizer will acquire all of the outstanding shares of Arena common stock for $100 per share in cash. The deal is expected to close in the first half of 2022.
In addition to its covid vaccines, Pfizer is also developing a treatment for ulcerative colitis, a chronic and inflammatory bowel disease that affects 3 million people in the United States. The candidate is currently in a mid-stage study, which is expected to be completed by the end of next year.
Meanwhile, Pfizer reported revenue of $24.1 billion in the last quarter, reflecting 130% operational growth. The pharma giant is expected to rake in billions of dollars after the company’s CEO Albert Bourla CEO said fourth Covid vaccine doses may be needed sooner than expected to fight the Omicron variant.
In a statement, Pfizer executive Mike Gladstone said: “The proposed acquisition of Arena complements our capabilities and expertise in Inflammation and Immunology, a Pfizer innovation engine developing potential therapies for patients with debilitating immuno-inflammatory diseases with a need for more effective treatment options.” He added, “Utilizing Pfizer’s leading research and global development capabilities, we plan to accelerate the clinical development of etrasimod for patients with immuno-inflammatory diseases.”
Arena has built a robust development program for etrasimod, including two Phase 3 studies in ulcerative colitis (UC), a Phase 2/3 program in Crohn’s Disease, a planned Phase 3 program in atopic dermatitis, and ongoing Phase 2 studies in eosinophilic esophagitis and alopecia areata.
In addition, Arena’s pipeline includes two development-stage cardiovascular assets, temanogrel and APD418. Temanogrel is currently in Phase 2 for the treatment of microvascular obstruction and Raynaud’s phenomenon secondary to systemic sclerosis. APD418 is currently in Phase 2 for acute heart failure.
“We’re delighted to announce Pfizer’s proposed acquisition of Arena, recognizing Arena’s potentially best in class S1P molecule and our contribution to addressing unmet needs in immune-mediated inflammatory diseases,” said Amit D. Munshi, President and Chief Executive Officer of Arena. “Pfizer’s capabilities will accelerate our mission to deliver our important medicines to patients. We believe this transaction represents the best next step for both patients and shareholders.”