Pfizer confirms $14bn Medivation merger

Pfizer has said it is to buy US cancer drug firm Medivation, after winning an auction against rivals including Sanofi, confirming widespread press speculation.

Pfizer will pay a premium of about one-third to Medivation’s closing share price of $67.16 at the end of last week, valuing the company’s equity at more than $14 billion.

Sanofi initially bid around $9.3 billion for Medivation, and later upped the offer to around $10 billion.

The US pharma giant has defeated a number of suitors for Medivation including Celgene, Gilead, and Sanofi, which had been aggressively pursuing the California-based company since the spring.

Pfizer famously missed out on buying Dublin-based Allergan for $150 billion earlier this year after the Obama administration thwarted the deal, which was designed to take advantage of lower tax rates in Ireland.

Pfizer wants to add Medivation/Astellas’ prostate cancer drug Xtandi (enzalutamide) to its portfolio of medicines, which is predicted to generate $5.7 billion in annual revenues by 2020.

Medivation also has developmental drugs, including late-stage cancer drug talazoparib, which it described as a potential best-in-class PARP inhibitor.

The drug is in phase 3 for patients with advanced breast cancer whose BRCA genes contain germline mutations.

Although Tesaro is developing a rival, niraparib, Medivation says it has a more convenient dosing schedule and competitive safety profile due to a slightly different method of action.

Medivation is also developing pidilizumab an immuno-oncology asset being developed for diffuse large B-cell lymphoma and other hematologic malignancies and has the potential to be combined with similar therapies in Pfizer’s portfolio.