Pfizer to buy Array BioPharma in $11.4 billion deal

Henrietta Brewer
June 19, 2019

USA cancer focussed biotech Array BioPharma (NASDAQ: ARRY) has accepted a $48 per share cash takeover offer from Pfizer, a 62% premium of its closing price on Friday and equivalent to an enterprise value of $11.4bn (market cap less net cash).

In addition to the combination therapy for BRAF-mutant metastatic melanoma, Array brings a broad pipeline of targeted cancer medicines in development, as well as a portfolio of out-licensed potentially best-in-class and/or first-in-class medicines, which are expected to generate significant royalties over time. Pfizer believes the therapy is a promising one that offers good long-term growth prospects.

Bourla also added that the deal has reinforced Pfizer's' commitment to deploying capital to bring breakthroughs in the lives of patients while adding to shareholder value. The companies said that is the third-most-common form of cancer:140,250 patients were diagnosed with cancer of the colon or rectum in the United States in 2018, and approximately 50,000 are estimated to die of their disease each year.

Under the terms of the deal, Pfizer will pay $48 per share in cash for each Array share, which is a premium of around 62% to the stock's closing price on Friday.

"The proposed acquisition. sets the stage to create a potentially industry-leading franchise for colorectal cancer alongside Pfizer's existing expertise in breast and prostate cancers".

Array said May 21 that the BEACON study, which combines its two drugs with Eli Lilly & Co.'s Erbitux (cetuximab), met its primary endpoints of showing improved overall survival and overall response rates for the triplet combination compared with Erbitux given with chemotherapy combinations.

In the U.S, colorectal cancer is a widespread type of cancer. Equities research analysts anticipate that Array Biopharma will post -0.51 earnings per share for the current year.

The deal is Pfizer's biggest deal since its $14 billion deal to buy Medivation - also a cancer deal. Array BioPharma's share price soared 56% after the acquisition.

The largest US drugmaker is paying a 62% premium on Array Biopharm to access the small biotech's approved treatments for skin cancer, along with its other experimental drugs, CNBC reports.

Pfizer said it expects to complete the acquisition in the second half of 2019.

Founded back in 1994, Alameda, California-based Exelixis has four drugs that are sold to treat various diseases around the world, including thyroid cancer, renal cell carcinoma, melanoma, and hypertension.

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