PharmExec Blog

Pfizer to Buy Wyeth for $68 Billion

Pfizer made it official this morning. The pharma giant acquired Wyeth for $50.19 a share or $68 billion in cash and stocks, and news of the merger sent ripples through the pharma industry:

Pfizer Broadens Beyond Pills with $68 Billion Wyeth Buy: Pfizer has agreed to acquire Wyeth in a $68 billion deal that’s the largest merger in the pharmaceutical industry in nearly a decade. In announcing the deal, the companies made clear that the Pfizer has in mind to cut its reliance on traditional pills. (WSJ)

Cheering a Pfizer-Wyeth Deal: With Wyeth, the combined company might earn $2.48 in 2012, still down from Pfizer’s prior year, but only by 11 percent and just a touch below what the two companies might have earned if they’d merged at the start of 2009, $2.46 per share. (Barrons)

A Pfizer-Wyeth Merger Isn’t the Cure-All: Acquiring Wyeth might boost Pfizer’s fortunes in the short term, but it won’t solve the long-term problems that are roiling the major pharmaceutical makers. As many observers have noted, Pfizer and the rest of the drug industry suffer from a lack of promising new products to replace older ones going off patent. What is less widely understood is that Pfizer also will face an increasingly constrained marketing environment, even if it succeeds in bulking up with Wyeth. (Business Week)

Pfizer-Wyeth Deal Could Stir Restive Rivals: With its lucrative vaccine business and biotechnology drugs not facing imminent patent expirations, Wyeth has become a target for companies bracing for generic competition for their most important drugs while struggling with development pipelines that have recently yielded few major new medicines. (Reuters UK)

Pfizer To Swallow Wyeth’s Good Medicine: The acquisition will give Pfizer a much larger presence in areas where it has been viewed as weaker than the competition, namely biotech drugs and vaccines. Wyeth, which makes the top-selling vaccine for children, Prevnar, would help fill this void. Wyeth also co-markets Amgen’s Enbrel biotech drug for rheumatoid arthritis. That is exactly what Pfizer needs as it looks to fill the void that will be left by Lipitor when it loses patent proteciton in 2010. (Forbes)

After Pfizer-Wyeth, Who’s Next?: Those who may sit on the mega-deal sideline, however, include giants GlaxoSmithKlineand Bayer, both of whom have indicated that they haven’t seen any big targets that tempt them, focusing instead on smaller purchases. (NYT)

Pfizer to Buy Wyeth in $68 Billion Deal: It would also be the first big merger backed by Wall Street in months. While credit has been notoriously tight of late, five banks have agreed to lend Pfizer $22.5 billion to pay for the deal. Pfizer, which has roughly $26 billion in cash, would finance the deal through the loans, some of its cash and stock. (NYT)

Behind Pfizer’s Deal to Buy Wyeth: Pfizer and Wyeth are facing a problem, which is systemic and not isolated to their industry. Each expects revenue to fall in the near future as some of their largest-selling drugs lose patent protection. Putting the two companies together will allow them to fire tens of thousand of people and cut other overlapping costs. The firms are nearly identical, which makes expense savings certain. (TIME)

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