Pfizer Inc. (NYSE:PFE) is reported to have signed an agreement to buy Global Blood Therapeutics Inc (NASDAQ:GBT) in a deal of $5.4 billion. The acquisition to the blood disorder drug maker will help Pfizer expand its drug pipeline. It’s the latest of an array of acquisitions targeted to aid Pfizer in the midst of the possibility of a reduction in COVD-19-related products as the number of cases continues to decrease.
Pfizer To Pay $5.4 Billion To Buy Global Blood Therapeutics
Pfizer accepted to offer $68.50 per share in exchange for Global Blood Therapeutics, which is the equivalent of a 7.3 percentage increase over the company’s closing price on Friday. This price is an increase of 42.7 percent over the closing price of Thursday. The Wall Street Journal had published earlier on the fact that Pfizer as well as Global Blood Therapeutics were at an advanced stage in negotiations regarding the acquisition.
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CNBC reported that Pfizer has seen its sales increase exponentially since the launch of its vaccine against COVID-19 that was created in collaboration with BioNTech. But, the company has seen sales slow from last year, even as the respiratory illnesses are declining.
Despite the company’s declining sales, the company has been seeking acquisition potential targets. The company is flush with cash from sales of the COVID vaccine. Pfizer’s plans to acquire other companies aim to increase billions of dollars in the annual sales of the company by 2030.
Pfizer’s Recent Acquisitions To Build Its Drug Pipeline
In May, Pfizer made a payment of $11.6 billion to purchase Biohaven Pharmaceutical Holding a company that makes migraine medicines. Pfizer has also completed the purchase of Arena Pharmaceuticals for $6.7 billion in the last few days.
The acquisition from Global Blood Therapeutics will boost the company’s rare disease treatment pipeline, with an addition Oxbryta that treats sickle cell diseases. The drug was first approved in 2019 for the treatment of the condition for patients at least 12 years old age. However, that approval was expanded to include patients younger than 12 years old in December 2021.
Sickle cell disorder is a blood disorder that is genetic that affects 70,000 to 100k people across the U.S. Oxbryta generated $55.2 million in sales for Global Blood Therapeutics in the first quarter. Cantor Fitzgerald analyst said to CNBC the company that Wall Street has wanted Pfizer to keep adding new assets that will provide more the scope of the company’s earnings announcements past the year’s end.
This is when the key assets of the pharmaceutical company start losing protection under patents. In addition, investors have pushed Pfizer expand its concentration of COVID-related drugs.
The shares of Pfizer were mostly equal at midday Monday and stocks of Global Blood Therapeutics had popped around 4 percent. Global Blood Therapeutics’ stock has more than doubled since Thursday, climbing from $34 after the closing of the market on Wednesday to around $47 in the early hours of trading on Thursday. The stock climbed to around $47 at noon on the Friday. Global Blood Therapeutics ticked up by 4% more on Monday.